Everything you Need to know About Replacement Car Cover
*Above mentioned prices are for Honda City EX 1.5L, 2017 model.
A car insurance policy protects the financial interests of the owner. By paying a small premium on an annual basis to the insurance company, you can cover various kinds of risk factors. A third-party insurance policy is a minimum and compulsory car insurance that you should possess to drive on UAE roads. It is cheap and covers third-party liability only. By going for a comprehensive insurance policy, the car, car owner, and the third-party are protected in a very efficient manner. With a comprehensive plan, there are various kinds of add-on covers as well available with which the vehicle insurance can further be enhanced and one of these add-ons is ‘replacement car cover’.
Replacement Car Cover Add-On
The replacement car cover is the most popular car cover add-on. As per the recent reports, it is the top sold add-on. Other popular add-ons are personal accident protection cover and breakdown cover. Even though a comprehensive plan provides a replacement car feature, but it provides a replacement of a car for who is not at fault in the accident.
This is the reason about 76% of all the insurance policies are sold with the replacement car add-on as the insurance company pays compensation regardless of who is at fault in the accident. If you purchase a replacement car add-on, the insurance company will provide a replacement of car regardless of whose fault it was.
What is Covered in Replacement Car Add-On?
The replacement car cover works as an extended courtesy car product. The greatest advantage of the replacement car add-on is that it will cover the risk which is not covered by your comprehensive car insurance policy.
If your car is stolen, the insurance company will offer the replacement of the car. Thus, the ‘replacement car cover’ will keep you on the road.
The geographical boundaries of UAE are covered by the add-on
You can buy for GCC coverage by paying an additional premium
The car can be delivered at your convenient place
If the car cannot be repaired or restored after the accident, the cover will be applied for up to 14 days
Who Should Buy the Replacement Car Cover?
If your Car is Stolen - It can be bought by anyone who is at risk of losing the car due to various reasons. If you lost your car due to fire accident or theft, you will be left with no car. The insurance company will come to your rescue and provide a replacement car so that you can undertake the journey without any issues.
If your Car is Written Off - Your car may be written off due to various reasons. If you failed to repay the car loan, the lender has the rights to auction the car after the court notice.
The car is Subjected to Vandalism - If your car is subjected to vandalism, there will be a great loss. In some cases, it will be treated as a total loss. The insurance company will provide the replacement of car so that there will be a great relief for the insured.
Convenience - There will be a convenience when you have access to the replacement car.
Fuel to Ride - The hired car comes with enough fuel to ride various locations so that personal, as well as official engagement, can be accomplished in a very efficient manner.
Drop and Pick Facility - The insurance company offers the dropping of the car at a location of choice mentioned by you. Similarly, it also picks the vehicle from the location opted by you.
Coverage of Additional Drivers - Some insurance companies allow two additional drivers as well under the ‘replacement car’ add-on.
Cushion Period to Figure out the Replacement Car - The insurance company offer you sufficient time to find the most appropriate replacement car that can fulfill your needs. You can go for a new or used car as per your budget.
You should cross-check the facility while subscribing to the add-on. The terms and conditions of various features offered under ‘replacement car add-on’ vary from one insurance company to other.
Exclusions of the Replacement Car Add-On
There are certain exclusions mentioned under the replacement car add-on.
Hire-Related Expenses - The insurance company is not liable for the payment of fuel charges. If there are any fines or additional fees charged by the hiring agency, the insurance company is not responsible for payments.
Hire Charges after the Expiry of the Cover - The replacement add-on cover is applicable for 14 days to 21 days. If you hire the car beyond the days mentioned in the insurance policy, you should pay those charges from your pocket.
Exceeding the Claim Deadline - The insurance company stipulates a deadline before which you should claim the ‘replacement car’ add-on. If you claim the ‘replacement car’ add-on after the deadline, the insurance company may not entertain your claim. Generally, the deadline is 5 days after the insured vehicle is declared a total loss by the competent authority.
In order to make the most of your car insurance policy, you should be aware of the terms and conditions mentioned in it. While buying a new insurance policy, you must assess your insurance requirements. You must buy the most appropriate policy to cover various kinds of risk factors in a very efficient manner and a replacement car add-on is one among these.