Total loss settlement under Replacement Cost Endorsement

Summary of settling total loss vehicle under the Replacement Cost Endorsement (APV286A).

Inflation adjustments

When a total loss occurs to a vehicle with a Replacement Cost Endorsement (APV 286A), the customer is entitled to additional compensation. The settlement available depends on whether the customers’ vehicle was purchased new or used.

When a replacement vehicle cannot be delivered within 30 days, the customer is entitled to a replacement cost settlement. That settlement may include an additional amount for inflation, as follows:

When the vehicle is in this model year...	Then the inflation adjustment is...
first	2.5%.
second	5.0%.
third	7.5%.

Note: Refer to Table three in Replacement Cost Endorsement for model year numbers corresponding to vehicle model years.

Settlement options

The following settlement options are available when a Replacement Cost Endorsement (APV286A) is in effect:

When the customer opts for...	And the vehicle was purchased...	Then the customer receives...
a replacement vehicle	new or used	the most current model of the same make with equipment and options similar but not necessarily identical to those of the described vehicle, or any other make and model provided it does not cost more than the most current model of the insured vehicle.
replacement cost when a replacement vehicle is not available within 30 days	new	the lesser of the original net purchase price plus applicable inflation adjustment, or the manufacturer's suggested retail price (MSRP) of the vehicle at the date of purchase, plus applicable inflation adjustment.
replacement cost when a replacement vehicle is not available within 30 days	used	the cost of a replacement vehicle for vehicles still in production, or the manufacturer's suggested retail price (MSRP) for that make at the time it was manufactured, for vehicles no longer in production, plus applicable inflation adjustment.
replacement cost when a replacement vehicle is available but the insured chooses not to accept it	new	the lesser of the original net purchase price plus applicable inflation adjustment, or the manufacturer's suggested retail price (MSRP) of the vehicle at the date of purchase, plus applicable inflation adjustment. Note: This settlement amount may not exceed the cost of the replacement vehicle entitlement.
replacement cost when a replacement vehicle is available but the insured chooses not to accept it	used	one of the "purchased used" options above. This option is not available.

Note: The cost of repair of any prior unrepaired damage to the described motor vehicle will be deducted from the settlement of the total loss or constructive total loss.