Which type of coverage helps protect the value of a vehicle against depreciation if it is written off in a claim?

Limited Depreciation Coverage is designed specifically to address the issue of vehicle depreciation when a car is deemed a total loss following a claim. Given that new vehicles can lose significant value shortly after purchase, this type of coverage helps mitigate that loss. It often allows the insured to receive a payout that reflects the full value of the vehicle at the time of loss, rather than just the depreciated value. This is crucial for those who want to ensure they can replace their vehicle without financial penalty due to depreciation.

In contrast, Full Replacement Coverage often refers to the ability to replace the vehicle with a similar make and model, but it does not specifically account for depreciation nuances. Basic Coverage typically provides only the minimum protection required by law and may not include options for addressing depreciation. Total Loss Coverage generally refers to coverage provided in the case of a complete loss but lacks the specific provision for valuing the vehicle to prevent loss due to depreciation.