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Car Insurance

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Replacement Cost Advantage

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Frequently Asked Questions

  • Replacement Cost Advantage defined
  • Higher premium
  • Total loss
  • Depreciation defined
  • Premium calculation
  • 2-year old car
  • Replacing options
  • Availability
  • Limitations and exclusions

Replacement Cost Advantage defined

How does Replacement Cost Advantage work?
This endorsement will allow you to obtain the same or a similar model of vehicle as the one you are currently driving if you find yourself in a situation where your vehicle is stolen or deemed a total loss within a period of up to 60 months from the original delivery date. If we are unable to put you in that specific vehicle, we will look at other vehicles that are considered equal in value, and have similar specifications and options.

If the vehicle is not replaced, we will pay the replacement value based on your endorsement.

Please note that the expiry date of the Replacement Cost Advantage product depends on the vehicle's delivery date and the date the policy takes effect.

Higher premium

Will my premium cost me more with Replacement Cost Advantage?
Yes. However, you will have the advantage of being able to replace your vehicle with a new vehicle of the same model. Since the coverage protects you against depreciation, you will not lose out.

Total loss

What do you mean, exactly, by “total loss”?
If the estimated repair cost plus the salvage value of your vehicle exceeds its cash value prior to the damage, we may decide to treat the vehicle as a write-off instead of paying to repair it. As your insurance company, we will pay the pre-collision value of your vehicle in today’s market, minus any deductible that may be applicable. If your vehicle is stolen and not recovered, this is also considered a total loss.

Depreciation defined

Could you define “depreciation”?
Depreciation refers to the decreasing value of a vehicle once it leaves the dealer’s lot. Depreciation is also based on, but not limited to:
  • the condition of the vehicle immediately before the damage occurred
  • the resale value
  • the normal life expectancy

Premium calculation

If I have a new vehicle, how is my Replacement Cost Advantage premium calculated?
The premium increases with time as your vehicle ages. Your benefits increase when the vehicle is older. Since the coverage protects you against depreciation, you will not lose out.

2-year old vehicle

If my vehicle is 2 years old, am I eligible for Replacement Cost Advantage?
To be eligible, you must have carried a Replacement Cost endorsement from the time you purchased your new vehicle, whether or not you were insured with us. If you buy a 2 year-old vehicle, you are not eligible.

Replacing options

With Replacement Cost Advantage, would you cover the cost of replacing all of the options?
Yes, if these options are still available.


Is Replacement Cost Advantage offered all across Canada?
No. This coverage is not available in the Yukon, the North West Territories or Nunavut.

Limitations and exclusions

Are there other limitations or exclusions regarding Replacement Cost Advantage that I should know about?The value of your vehicle must not exceed $65,000, including both taxes and accessories. You are not eligible if:
  • There has been a loss due to theft or attempted theft in the past 3 years
  • Your vehicle is customized/modified
  • There have been 2 at-fault losses in the past 3 years (not applicable in Ontario)
  • The principal operator has had his/her driver’s license suspended for a period of one year or more in the past 3 years.

Please contact one of our knowledgeable insurance professional for more details on the limitations and exclusions that apply to this coverage.

In case of discrepancy between the information provided on this website and your insurance policy, your insurance policy prevails. Remember, the exclusions and limitations specified in your policy apply in all circumstances.

The information and examples provided in this section are intended as general information only. This does not constitute legal or insurance advice, nor does it pertain to determination of fault. In all cases, you should speak to an insurance professional before acting. Your insurance policy contains limitations and restrictions which vary by province and may affect your coverage and/or determine whether or not benefits will be payable.


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