Vehicle Replacement Insurance?

[Brent.ff]

Got my renewal from TD and have this on there that added an extra $300.

http://www.group.tdinsurance.com/en/replacement_cost

So I figure, odds are I'll depreciate more then $300 this year, so a half decent option? Or what am I missing? Anyone try to use this before?

2014 Tacoma, if that matters.

[Xtrema]

You have to total to claim. If you are paying this for 5 years, that's $1500 to guard against about 50% of your depreciation in case of car is written off.

At $300, I don't it's worth it.

[ExtraSlow]

It's more than 1500 for the five years, because this amount goes up every year as the gap between the cars depreciated value and the value of the brand new replacement increases.

I have bought this in the past, but don't think it's a great value.

[Aleks]

We had it on our minivan and I just cancelled it. As years go on the premium goes up as extraslow mentioned. I think I would do it again for the first couple years maybe but after that get rid of it.

[Brent.ff]

Think i'll keep it for this year then drop it, after this it'll probably be too much. At the very least the tacoma depreciation curve is pretty low.

[Team_Mclaren]

Its usually worth it for the first three years, then as the premium goes up it makes less sense.

[Masked Bandit]

Originally posted by Brent.ff
Think i'll keep it for this year then drop it, after this it'll probably be too much. At the very least the tacoma depreciation curve is pretty low.

One of the companies we work with has this option but we never sell it and here's one of the reasons why...let's assume for the sake of this discussion that the original MSRP on your Tacoma was $40K. Since you have that coverage, if you're in an accident that means TD will sink as much as 75% of that $40K into repairs. Do you REALLY want a two to three year old vehicle back that's had $30K worth of collision repairs? I know I sure wouldn't...lol. The 43r (which I think this coverage is) normally is available for the first 2.5 years of ownership at about $35 - $45 per year. Even if you bought this truck in the fall of 2013 you should still be paying way less than $300 for the balance of this year.

[Brent.ff]

So they would look at the write off and potentially just cover more repairs before calling it written off?

Hmm good point

[SKR]

Originally posted by Masked Bandit


One of the companies we work with has this option but we never sell it and here's one of the reasons why...let's assume for the sake of this discussion that the original MSRP on your Tacoma was $40K. Since you have that coverage, if you're in an accident that means TD will sink as much as 75% of that $40K into repairs. Do you REALLY want a two to three year old vehicle back that's had $30K worth of collision repairs? I know I sure wouldn't...lol.

What value do they give you if you do total it off though, and you don't have the full replacement insurance? Do they give you whatever the actual value of the vehicle is, or do they give you what you owe? I'd much rather have a vehicle that was brought back from the brink of fucked than to be making payments on a vehicle that no longer exists.

I've always had the insurance on my new vehicles, just because it takes a while for your payments to get ahead of the depreciation. But maybe I just don't understand how it works.

[botox]

^^ They give you current market value of your car. How much you owe the bank is not their problem. My dad just wrote off his 04 CRV and they gave him $7500 which was higher than what I was expecting but the thing was mint with low km's. I think the damage limit is like 75-80% and its total loss.

[SKR]

Yeah, so I don't get why anyone wouldn't use it.

[Xtrema]

Originally posted by SKR
Yeah, so I don't get why anyone wouldn't use it.

For $45 a year to cover full value of $40-$70K, why not.

$300, not really.

[AE92_TreunoSC]

Most people are fucked if they total their vehicle in the first 3 years, the loan isn't covered by the payout that insurance gives you. I recommend anyone with a new vehicle get a 43R or 43L.

I've seen it benefit many people in bad situations, plus the wifey was an insurance adjuster with enough stories. I have it on my leased Tacoma and had it on my Subaru prior that was financed. I like having young vehicles so I'll likely have 43r/l on most of my vehicles on.

[FishPoo]

I usually have the replacement insurance for the first 2-3 years now.

I ended up using it the first time I got it, our parkade flooded and my car was a write-off and it was probably less than a year old at the time. So they called the dealer got a cost estimate to purchase the exact same model in the current model year and wrote me a cheque for that amount.

A year before that, I had a fairly new car without replacement insurance and it also was written-off and received market value using autotrader ads for same year, make, model and equivalent options so I lost a good portion to depreciation.

]The odds of a total loss are pretty low but hey shit happens and I had 2 total losses in two years so in that situation it pays out fairly well.

[Kijho]

Keep that shit on there if you have a new car. I'll never own a new(ish) car again without replacement insurance. I had to go back and forth with TD last year to negotiate and show them other for sale ads of my same car which were selling for higher to get back what I paid for the loss of a car. Do it!! Keep that insurance!

[Masked Bandit]

As a point of practice in our office, every single vehicle that qualifies for the standard SEF 43R / 43RL gets the coverage. The trick is that it's the original owner only that can have it, so if you buy a "used" car with 2500 KM on the clock, you can't get it. Industry standard is 30 months of eligibility but the "replacement" coverage can go as long as 5 years. There is a subtle difference between the two approaches during the first 30 months though:

43R will pay you the purchase price of the vehicle or MSRP, whichever is lower. So if I buy a new Tacoma in 2014 for $40K and MSRP is $41K, if it's written off within the 30 months I get the $40K I paid for it. Be careful though because there is no coverage for things like the admin fees or extended warranty costs. Using the 2014 Tacoma in the original post, the cost for this coverage would be $80 per year for the first three years so $240 total.

If you have the replacement option, you are insured for the cost to buy a BRAND NEW version of your vehicle, so if a 2016 Tacoma is now $43K, that is what you are paid assuming you ACTUALLY replace the vehicle. If you just want the money and you either don't buy something or want to buy something else, then you just get the same payout as you would on the 43R. Keep in mind that you can keep this coverage running for up to 5 years but the costs are much higher. Using this same 2014 Tacoma (double cab 4wd), the costs would be $95, $135, $180, $230 & $290 in each of the five years for a total of $930 in insurance costs. By the sounds of things TD's pricing is even more expensive for this as the OP is only on the 3rd year and they already want $300 in premium. What are year's four & five going to look like? Yes, it can still work in your favour if the vehicle is written off in the first five years AND you want to buy the exact same vehicle again, but it's a gamble.

For my money the replacement insurance angle has too many variables to work out in my favour so I'm not a fan. I think the 43R approach is better value for the money.

[Zhao Kan]

It's completely insurance company dependant but often a 43r or S will mean new oem parts only on your vehicle. Don't have it and an insurance company will likely be putting aftermarket panels or used parts on your 2 year old vehicle.

Td is one of the few insurance companies that is happy only using oem parts regardless of age of the vehicle for almost everything, unless the customer wants aftermarket for some reason

[killramos]

Isn't this coverage a standard practice on vehicles holding a lien?

Just a basic guarantee that the financer gets the entire loan amount back even if the secured asset no longer exists.

I know BMW FS made me carry the coverage so long as their lien was on the car. With replacement option as well. Once the car is paid off you can remove it however.

So to OP, to confirm, your car isn't financed is it (reasonable question on a 2014)? Because in that case you probably cant remove the coverage. Just shop around for something cheaper and equivilent a la masked bandit.

[Aleks]

Originally posted by killramos
Isn't this coverage a standard practice on vehicles holding a lien?

Just a basic guarantee that the financer gets the entire loan amount back even if the secured asset no longer exists.

I know BMW FS made me carry the coverage so long as their lien was on the car. With replacement option as well. Once the car is paid off you can remove it however.

So to OP, to confirm, your car isn't financed is it (reasonable question on a 2014)? Because in that case you probably cant remove the coverage. Just shop around for something cheaper and equivilent a la masked bandit.

I've never had any finance company ask me for "gap" insurance, no matter if the vehicle is leased or financed. This coverage is always optional. I know for leased they have a minimum coverage they need you to have which isn't really any different than you'd want on a new car anyways.

[Brent.ff]

Financed.. however this was not a mandatory coverage item. Likely cause its a Toyota not a beamer