Archive for February, 2008

New for old car insurance

Thursday, February 28th, 2008

Many car insurance providers offer attractive policies having a “new for old” clause or benefit. As per this benefit the coverage includes a replacement of your vehicle with a brand new car of the same make and the same model. This option can be availed in case your car gets stolen or cannot be found. However the following two clauses need to be met. Firstly, you should be the first owner (registered) of your car and your car should not be more than 12 months old.

“Gap” Insurance is also one of the latest offerings of Car Insurance providers. The term “gap” here implies to the difference in net asset value of your car when it was purchased and it’s WDV (“written down value”) prior to the mishap. This gap will form the basis of the settlement.

Gap Insurance partially covers the new for old coverage in the primary year; however it would be worth a thought to consider your car’s expected depreciation over the first few years.