Who Carries the Best New Car Replacement Coverage?

New car replacement coverage protects you from the instant depreciation that happens when you drive your brand new car off the dealer’s lot for the first time. Without new car replacement coverage, you could be left hundreds, or even thousands, of dollars in the hole if your new car is totaled within the first year or two after you purchase it. With a standard insurance policy that doesn’t include new car replacement, your insurance company will pay you the depreciated price of your new car, no matter how much it cost you just a few months before. New car replacement coverage means that you don’t have to settle for an older car or a less expensive model if your car is damaged beyond repair within a certain time frame. The following car insurance companies offer some of the best new car replacement coverage.


Working through The Hartford car insurance company, AARP offers a new car replacement coverage-option as part of its standard insurance policy. It is automatically included in your regular premium. If your car’s damage after an accident would cost more to repair than the car is worth, you would be able to purchase a new car that is the same make and model with the same equipment package as your previous car. The damaged car must be less than 15 months old, or it must have fewer than 15,000 miles on it in order to qualify.


Alllstate offers new car replacement coverage as part of its comprehensive auto insurance policy. The replacement policy is one of the best because it will replace your new car for up to 3 years after you purchase it. Most replacement coverage is available for only a little more than a year. Allstate’s generous coverage allows you to skip the depreciation for an entire three model years after the car was manufactured.


New car replacement coverage is an addition you can choose for your car insurance policy through MetLife. The qualifying period for a new car replacement is only one year or 15,000 miles, so it is a bit more limited than other comparable insurance policies. MetLife will also apply your deductible to the payout toward the new car, which is something to keep in mind if you carry a very high deductible. MetLife doesn’t have any stipulations about what kind of make or model car you buy through this program, though, which allows you to purchase any replacement car that fits the price range of the car you lost.

Liberty Mutual

Another good new car replacement coverage-plan is from Liberty Mutual. The period is more restrictive, but the replacement options are more flexible. With Liberty Mutual, you qualify for the replacement coverage plan if your car is less than a year old or has fewer than 15,000 miles on it when it is totaled. The coverage does not apply to cars previously owned cars or leased cars. Your standard deductible will apply.

New car replacement coverage is not available in every area, so check with your agent to find out if it is offered in your state. It’s an interesting option that could save you a substantial amount of money.

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