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Why Buy New Car Replacement Insurance

Buying a new car can be a dream given form. But this beautiful dream can quickly end if the recently purchased car is totaled during an accident.  As you can imagine, recovering the loss is difficult and insurance companies will not agree to pay the full value of the car. Instead, they will try to haggle and delay the claim settle, until the actual cash value will be a bit lower. But you can avoid that if you purchase new car replacement insurance. Find out more about this policy and get a car insurance quote online.

get a car insurance quote onlineNew car replacement insurance will help you buy new vehicle after an accident. If your car is totaled in a collision, then new car replacement insurance will replace your vehicle with one of the same make and model. Classical insurance will pay for the value of your vehicle, but it is always less than what you paid for your car in the first place. In many cases, the insurance payout is too little to buy an adequate replacement car. The value of a new car declines significantly the moment you drive it off the lot. You might have paid $55,000 for a brand new SUV, for example, but insurance will only pay you $40,000 if that vehicle gets totaled in a collision next month.

New car replacement insurance will pay for a brand new car of the same make and model of the totaled vehicle, minus the deductible.  In general, new car replacement insurance will:

  • Cost more than regular collision insurance
  • Apply only to newer cars
  • Is available only when you buy collision and comprehensive insurance
  • Reimburses you for the cost of a new vehicle of the same make and model, minus the deductible, if your car is totaled in a collision

It makes sense to buy this coverage only for new cars and keep it active for around on year. Keep in mind that not all insurers sell this policy.

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