"No depreciation replacement program" -- worthwhile?

[Shepherd]

I gather from these boards and others that extended warranties are pretty much money burnt, and  I understand the logic -- if I pay $1200 for a three-year extended warranty on everything but the engine & powertrain (which still has plenty of warranty left), I'm basically gambling that $1200 of stuff WILL go wrong within three years. Which is not a great bet.

They're pushing something on me called "Prévision" from Aviva, endorsed by the CCAQ -- $1200 for 5 years; basically it ensures that the vehicle is covered in a total loss for the original purchase price plus 5% per year, and the dealer covering my deductibles for $250 for partial loss (excluding glass breakage; no claim limits for that) and $500 for total loss; a replacement vehicle allowance of $50/day. Some other stuff too, but that seems like the most salient.

It works out to $1200 for five years of coverage, give or take. I'm on the fence about it, leaning towards "no" because, again, it seems like I'm gambling on me wrecking my car and we're pretty short on money in the first place. It's essentially taking out another insurance policy on top of my current policy for about $240 per year.

I can't find anything like this in these forums. Is anyone familiar with these sorts of policies? Are they worth it in your experience?

[dorin]

No! 

You've worked hard to find a car within your monthly budget.  Don't blow it now by getting additional stuff that you're unlikely to ever benefit from.

[johngenx]

Extra $1200?  Huh?  I have a 4 year depreciation waiver included in the insurance on the Corolla, but this was not an option and simply part of the policy from this particular firm.

[Shnak]

I've got something similar with my insurance company, it's called "Valeur à neuf", not sure what the exact term is in english.

I'm not sure what the amounts were for the first three years (I think it started around $100 extra), but for the 4th year of ownership, I'm paying around $250 extra. If the car is totaled, I get full replacement value of the original purchase price of the Sportage. They only offer this for the first 4 years.

In all, I suppose I will have paid $600 or $700 extra for this protection over the 4 years. Of course, once the 4 years are up without any claims, it'll be easy to look back at that money and say it was a waste, but with a quickly-depreciating vehicle, I think it's worth it.

Actually, now that I think about it, I kind of wish our Sportage would get totaled in the next few months to get something new! That is, without anyone getting injured, of course! 

[vdk]

$1200?  The depreciation waiver is about $50/year for 2 yearsin ON...

[Shepherd]

When the lady was pushing it on us I said "pretty much the best thing for me to do is take this for five years, and then do my level best to total the car at 4 years 11 months, using up my insurance's one-accident-gimme clause."

She gave me a look that suggested it'd be better not to think about it.

I need to ask the insurance person about depreciation waivers, etc. The saving grace of this thing MIGHT be that it pays my first $250 and $500 on minor/major accident deductibles, which means I can raise the deductibles on my standard insurance, which might make a big difference. My insurance situation is pretty messed up given that I'm in my mid-30s and have never insured a car as a principal before, and my wife has moved up from the States but isn't a permanent resident yet. Individually these are bad things; together they're a pretty toxic mix for insurers as it turns out.

[Trainman]

ICBC is charging me $85/year for the Forester.

[Shnak]

ICBC is charging me $85/year for the Forester.

Do you know if the price will stay the same as your Forester ages, and up to what, 4 years old?

[toolatecrew]

43R or depreciation prevention waiver on your insurance policy is much cheaper (even if your insurance "rate" is relativley high. As far as I know the 43R is a flat monthly fee on top of your insurance payment it doesn't fluctuate based on risk. SO even if your insurance is high the extra protection would not be much more.

IMO anyone not spending the extra $100 or so for the depreciation protection rider from their insurance company on a new car is a FOOL.

[Shepherd]

This is a used vehicle, which may be why it hasn't come up in my insurance talks.

[Leviathan]

ICBC is charging me $85/year for the Forester.

Do you know if the price will stay the same as your Forester ages, and up to what, 4 years old?

It goes up each year. I don't recall the exact numbers for the Tribute but it was stoopid cheap ~$60 the first year and the last year was ~$300 with the second year somewhere in between. The ICBC coverage didn't go past 3 years.

[apt212]

43R- depreciation waiver- approx $40-$50 per year (of course price varies with different companies) per vehicle valid for max 2 years

43S- replacement coverage- premium varies with vehicle-
calculated at 12-15% of comprehensive and collision premiums
for year 1

year 2- 24%-30%
year 3- 36-45%
year 4- 48-60%
year 5- 60-75%

To reiterate; 43S is calculated based on collision and comprehensive premiums

thanks