International Insurance Consultants

Contact: Mark Standen

Tel DL: +44 (0) 1322 476 276 . Mob +44 (0) 7427 628 886 enquiries@mocden.co.uk Mocden					| Ins Services Insurance Services Mocden
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Understanding Down Payment Guarantee

What is Down Payment Guarantee?

Down Payment Guarantee protects the customer against the loss they will incur in the event of an incident leading to a total loss to their vehicle.

Their primary motor insurance pay-out, following a total loss will generally be based on the Actual Cash Value (ACV) at the date of loss as listed by the National Automobile Dealers Association retail value.

This loss leaves the customer with a difference between the insurance pay-out and the cost of a subsequent vehicle replacement. To purchase another car the customer will have to pay this difference if they do not have Down Payment Guarantee.

With Down Payment Guarantee in the event of a claim, the Authorized Dealer will provide the customer with a credit for this difference against their next vehicle purchase.

How does it Work?

Down Payment Guarantee provides the customer with protection for their subsequent vehicle replacement for the term of cover they have selected, but not exceeding five years.

In the event of a total loss to their vehicle the cover they have purchased guarantees to provide them with a credit that when added to their total loss pay-out from their primary motor insurers will enable them to purchase a subsequent replacement vehicle of similar invoice value to what they paid for originally.

The above table assumes the customer has purchased their vehicle today for $25,000.

The figures on the BLUE LINE represent the likely pay-out the customer will receive from their primary motor insurer in accordance  with the ACV.

The amounts inserted just above the RED LINE illustrate the shortfall they will suffer as a result if vehicle depreciation in accordance with the likely ACV value over time.  

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