Insurance Companies Don't Have to Pay for OEM Parts?

When you are in an auto accident, even if your car is repaired correctly, it suffers "diminished value." That is, the car is worth less because it has been in an accident. In general, people will not pay as much for a car that has been wrecked as one that has not--even if the repairs take it back to pre-crash conditions. And to make things worse, insurance companies (at least in Ohio) do not have to repair your car with OEM parts (such as using parts made by Ford for a Ford automobile). They are allowed to use aftermarket parts which are cheaper but may not be as good of quality.

I did not know this until my daughter was rear ended by someone while she was sitting at a stop light. I obtained an estimate for repairs from a body shop close to me. The total was slightly over $1400. Cole Schneider, from Grange insurance, refused to pay this amount. While the body shop examined the car and his insurance company never did, he decided the total was just over $800. When I told him I would have the body shop send him photos to support the claim he said he would not accept photos from them because they were not a body shop approved by them. But anyway, I mentioned that the entire thing was ridiculous because the amount was relatively low anyway and if I planned to rip them off, I certainly would not have told the body shop that aftermarket parts were okay to use in their estimate.

At that point he told me he would not okay OEM parts anyway because under Ohio law he does not have to. What!? Why not? Why do insurance companies basically make the laws that we all have to live by? If your car is damaged by someone else, why don't they have to repair it to pre-existing conditions?

In this case, I ended up paying for the repairs myself since Grange decided they would not pay for the total and only sent me the $800+ which I sent back (they also said they would pay up to $30 a day for a rental car while the car was in the shop! Where does one get a rental car for $30?). They said they would only pay more if the shop documented the repairs and Grange approved them. Grange also told me at that point that they had "exhausted communications" with me and "Please send your attorney’s letter of representation" if I did not like the deal. In other words, get a lawyer if you don't like it. Well, since Grange already disapproved the repairs the body shop said was needed (and since no one from Grange ever examined the car), I was not going to take a deal that allowed them to have the final say in the matter, so a lawyer will now be involved to deal with this ridiculous situation.

But the point here is why do insurance companies not have to pay for OEM parts to repair a vehicle so that it is put back to pre-crash conditions? When someone damages your vehicle shouldn't they have to repair it with the same quality parts the car came with originally?