What is Depreciation Deduction Coverage?
Are you considering buying a new vehicle? Are you seeking peace of mind to get the most value out of your new car if you do? In that case, Depreciation Deduction coverage is something you should consider.
Depreciation is the decrease in a vehicle’s value over time. This affects how much you’ll be reimbursed should you make a car insurance claim for a total vehicle loss (either for theft or damage).
Considerations insurance companies use when calculating claims situations are:
- Year, make, and model of the vehicle
- How many kilometres are on the vehicle
- Wear and tear
- Online sale amounts
All these factors play into your vehicle’s depreciation value. OPCF 43 (aka Depreciation Deduction coverage) is an additional coverage you can add to your auto insurance that basically negates that depreciation.
This coverage is only available on new vehicles at the time of purchase, and by adding OPCF 43 to your coverage, insurance companies can no longer deduct depreciation when determining your reimbursement.
Essentially, this coverage ensures that you will get into a brand-new vehicle of the same make and model (or as close to your make and model if it has been discontinued) or be compensated for a brand-new car.
Interested in getting depreciation deduction coverage? Speak to a dbi broker today to find out more.