Replacement Insurance

What is replacement insurance?

For new vehicle or demonstrator vehicle

In the event of total loss, where the described vehicle is a new vehicle or a demonstrator vehicle, the insurer agrees to pay an indemnity only when the named insured replaces the vehicle with a replacement vehicle. Replacement does not need to be made through the named dealer.

The insurer agrees to pay an indemnity equal to the difference between:

For a used car

In the event of total loss, where the described vehicle is a used vehicle, the insurer agrees to pay an indemnity only when the named insured replaces the vehicle with another vehicle. Replacement does not need to be made through the named dealer.

The insurer agrees to pay an indemnity equal to the difference between:

Any amount not borne by the insurer will be borne by the named insured.

If the described vehicle was purchased or leased from a dealer of motor vehicles within 60 days of the effective date of the insurance contract, the marked-up value will be the purchase price of the described vehicle increased by 5% compounded annually, calculated in proportion to the number of days elapsed between the effective date of the contract and the date of the total loss.

In all other instances, the marked-up value will be the value of the described vehicle on the date of total loss increased by 17% compounded annually, calculated in proportion to the number of days elapsed between the effective date of the insurance contract and the date of the total loss.

 

 

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