Optiom Insurance: The Best Way Protect Your Vehicle From Depreciation

Optiom Prime: Turbocharging Your Auto Insurance

Imagine this: you buy a brand-new vehicle for $40,000 and take it home. You and your family use this vehicle daily for over four years, and then it gets in an accident. To your dismay, your vehicle is totalled. Luckily, you have auto insurance coverage that will reimburse you. Right?

Not exactly. Yes, your auto insurance carrier may write you a small cheque for the vehicle that was written-off, but only as much as it was worth (the depreciated value) at the time of the accident.

That’s where Optiom Prime comes in. Optiom Prime will reimburse you for what you paid, unlike your average auto insurance policy. Here’s how it works.

What is Optiom Prime?

If you bought your vehicle new, Optiom Prime will reimburse your written-off vehicle for the difference between your primary insurance carrier’s market value payout and the amount the vehicle was worth when you purchased it for up to seven years after the fact. If you bought your vehicle used, Optiom Prime will reimburse you for up to five years after purchased. This includes any HST tacked on.

Market Value Vs Optiom Prime Payout

Put simply, take your $40,000 vehicle. This was the market value at the time it was purchased. Over time, that value changes – regardless of how much you paid initially. At the time of loss, your vehicle has about $18,000 of market value. Optiom Prime, however, will value your vehicle at the same $40,000 and would offset the loss by paying you the $22,000 remaining.

Why?

Because cars lose value overtime. You and your family likely treasure your vehicle, and you’ve used it plenty over the years. It’s seen a lot of soccer practices, trips to and from work and school, road trips, and so on. Unfortunately, as all things do, your vehicle will age and wear and with newer models on the market, it just won’t be worth the same as it was when you bought it.

Due to this, many auto insurance policyholders find themselves “underwater”. When their vehicle is written off in an accident, they won’t receive a settlement in line with the vehicles current financed  value.  Instead, they will only get the current market value – which can end up costing the policy holder additional cash out of pocket in the event of a loss.

Optiom Prime coverage premiums are locked when you purchase a policy, and there is a guarantee for no re-qualifications (for your vehicle) or increases as long as you maintain your insurance. You will continue to be eligible for coverage for up to 7 years for newly purchased vehicles and up to 5 years for used ones.

How?

Your primary auto insurance carrier will pay the market value of your car as part of the mandatory comprehensive and collision coverage you would need to carry.  Optiom Prime is an additional policy, although not mandatory, it will pay the difference to ensure you get the amount you paid if your vehicle is written off in an accident.

If you currently have lease or loan obligations and your vehicle is a total loss, Optiom Prime will contribute to that too. Like other endorsements, Optiom Prime is an additional purchase that supplements your existing insurance. You may also add optional coverage (for an additional premium) for new and used vehicles.

Partial Loss Deductible Reimbursement Benefit

If you need to pay out for a deductible on your primary auto insurance, Optiom Prime can reimburse you if there is a loss where your vehicle is repairable. Optiom Prime can pay up to $500 if your vehicle is able to be repaired following an insured loss.

Rental Vehicle Reimbursement Benefit

If you have rental vehicle coverage provided by your primary auto insurance provider which ends before your vehicle can be replaced or repaired, Optiom Prime can reimburse you for the continual rental vehicle costs until the repairs/replacement is complete.

Key Fob Reimbursement Benefit

Optiom Prime can reimburse you the cost to replace your vehicle’s key fob if you lost it. This includes up to $500 if vehicle’s keys are stolen or lost.

Diminished Vehicle Value Benefit

If you are involved in a no-fault accident, your Optiom Prime will pay a fixed amount if the necessary repairs exceed over 25% of the declared value of the vehicle (when the accident took place.) The vehicle’s value at the inception of your policy will determine the fixed payout amount (ex: if the vehicle value is between $5,000-$10,000, the guaranteed payout will be $1,000, and so on.)

The Bottom Line

Sometimes your basic auto insurance just isn’t enough. Ontario requires that drivers purchase a base minimum of liability per provincial requirements but that still leaves many vehicle owners underinsured when their cars and trucks suffer from depreciation over the years. If a no-fault accident was to take place where your vehicle was written-off, what would you do? Optiom Prime can protect your family’s prized investment when you need it most.

Depreciation can decrease your vehicle’s value up to 20% in the first year and 15% per year following. That can be a huge financial impact without having the right coverage. Optiom can mend the gap and give you and your family the peace of mind you deserve.

Optiom Prime is underwritten by underwriters at Lloyd’s and administered by Optiom Prime Inc.

To learn more about Optiom, visit our Optiom page.

To watch the Optiom video, click here.