Comprehensive Insurance Payout?

Question

I just recently had my 2005 BMW stolen from my garage at home. (Toronto, Ontario) Now, as the time to settle with my insurance company draws closer, I wanted to know what I am entitled to. The car was leased through BMW with $5800 down. My buyout today is in the $33,500 range. The street value of my car (very low mileage, executive edition) ranges from $35 - $41k. My question is will my insurance company only pay off the $33k owing to BMW or will they re-imburse me any of the cash I put down as the value of the car was greater than what the lease b/o is.

Answer 1

The insurer is liable for the actual cash value with proper deduction for depreciation. However certain factors can affect this value including: mechanical condition, mileage, equipment and accessories or any other information which affects it's value. Most Canadian insurers use the Canadian Red Book Vehicle Valuation Guide (link provided) to determine a vehicle's actual cash value, unfortunately you will need a subscription to use their service.
However take a look at your policy and see if on the Declarations page you see written somewhere: O.E.F. 43R (might be S.E.F. 43R, O.E.F. 43L or S.E.F. 43L) Limited Waiver of Depreciation Endorsement. This Endorsement is offered by almost all insurers for people who purchase a new vehicle. This endorsement provides coverage against depreciation when the loss occurs within 24 months of the purchase of the vehicle by its original owner. If you do then valuation will be the actual purchase price of the vehicle and its equipment (as you can see this is quite a valuable coverage). If you do not have this coverage, and you bought the vehicle new, you may want to ask your broker/agent why this coverage was not added.

Answer 2

Your insurance pays you the actual cash value of the car, the rest of what you wrote doesn't matter. If the ACV is more than your "buyout," then you keep the overage. If the ACV is LESS than your "buyout," then you owe the difference to the bank. Do you have GAP insurance? You may want to check.

Nonetheless, your insurance company will discuss this with your bank to confirm the amount of your "buyout" and they'll tell you how much they are issuing the payment for and to whom.