WalletHub, Financial Company
Yes, Erie offers new car replacement insurance through its New Auto Security endorsement, which pays to replace a totaled car with a brand-new vehicle of a similar make and model. Unlike most other insurers, Erie’s new car replacement coverage can be purchased for any policy, regardless of the vehicle’s age or mileage.
How Erie’s New Car Replacement Coverage Works
- If your car is less than two years old when it’s totaled, you’ll be reimbursed for the cost of a replacement car that’s the newest model year.
- If your car is more than two years old, you’ll be reimbursed for the cost of a vehicle that’s two model years newer than the one that was totaled.
- If your car is leased, the endorsement won’t pay for a replacement vehicle, but it will still provide you with gap insurance.
Without new car replacement insurance, Erie will only reimburse you for your totaled car’s actual cash value (ACV), which is affected by factors like depreciation and physical damage. Because new cars start depreciating almost immediately after purchase, a totaled car’s ACV is usually not enough to pay for a similar replacement vehicle.
If you own a new car or are looking to purchase one soon, Erie’s New Auto Security endorsement may be a smart investment. This coverage is especially worth it if you drive a car that depreciates particularly fast, like a sports car or electric vehicle, or you can’t afford to pay partially out of pocket for a replacement car in a worst-case scenario.
To learn more, check out WalletHub’s guide to new car replacement insurance.
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