Does Progressive Offer New Car Replacement Insurance?

Progressive doesn’t offer new car replacement insurance, but you have other options for coverage.
Written by Bellina Gaskey
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Progressive does not offer new car replacement insurance. However, with comprehensive and collision coverage, policyholders are covered up to their vehicle’s actual cash value after a total loss (minus their deductible).
  • While Progressive doesn’t offer new car replacement insurance, there are plenty of providers that do, including
    Allstate
    ,
    Liberty Mutual
    , and American Family.
  • Gap insurance
    is another coverage worth considering for new vehicle owners.This coverage will pay the difference between your car loan value and your car’s cash value if it’s totaled prematurely.
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Does Progressive offer new car replacement insurance?

No, Progressive doesn’t offer new car replacement insurance
New car replacement coverage
is an optional add-on protection available with some auto insurance providers. 

How does new car replacement insurance work?

Vehicles tend to depreciate fastest during their first several years of ownership. You can expect the typical vehicle to lose about 11% of its value once you leave the dealership, then 20% to 30% within its first year. 
If you have new car replacement insurance, the insurance company will pay you the vehicle’s replacement cost in the event it’s totaled—not this depreciated actual cash value.

How are comprehensive and collision coverage different from new car replacement insurance?

For vehicles that don’t have new car replacement insurance but do have comprehensive coverage and collision coverage—referred to together as “full coverage”—insurance providers will pay you your vehicle’s actual cash value (ACV) minus your deductible after a total loss. 
Under this system, if you bought your vehicle new for $30,000 and your vehicle’s depreciated value fell to $25,000 at the time it was totaled in a car accident, you’d have $5,000 less to purchase a replacement vehicle.
New car replacement often adds about several hundred dollars to a car insurance rate—which can make it quite cost-effective if you ever need to use it.

What happens if you total your car with Progressive car insurance?

If you total your car and have a Progressive insurance policy:
  • If you have comprehensive and/or collision insurance and your claim is covered: Progressive will pay you based on the vehicle’s ACV minus your deductible.
  • The cash value will depend on the vehicle’s condition before it was damaged, its mileage, and the resale value of comparable vehicles.
  • Depending on whether you own your car outright or you’re financing your vehicle, Progressive will pay that amount to you, your lender, or both.
  • If you have liability coverage only: a totaled vehicle wouldn’t be covered by your policy at all if you were at fault for the accident. If another driver was at fault in a collision, their property damage liability insurance would pay for your vehicle’s damages.

Which car insurance companies offer new car replacement insurance?

Progressive may not offer new car replacement insurance—you won’t find it with Geico or State Farm, either—but there are plenty of providers that do. These include:
If new car replacement insurance is a priority for you, it’s a good idea to request car insurance quotes from multiple providers to increase your odds of finding the most affordable premium.
Different providers will have different eligibility criteria for what vehicles can have new car replacement coverage. 
For example, Liberty Mutual offers new car replacement for vehicles one model year old or newer and with fewer than 15,000 miles, while Allstate extends this coverage for up to two model years.
MORE: What to do after buying a new car 

Which Progressive insurance coverage options would be good for a new car?

If you own a brand-new vehicle and you’re a Progressive policyholder, here are some additional types of coverage worth considering:
  • Gap coverage: This coverage, which stands for “guaranteed asset protection,” will pay the remaining balance on a car loan or lease if your vehicle was totaled and its depreciated value left you with an
    upside-down car loan
    .
  • Rental reimbursement coverage: If your vehicle is damaged by a cause that’s covered by your car insurance policy,
    rental reimbursement
    coverage will help cover the costs of a rental vehicle while yours is getting repaired at the auto shop.
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FAQs

Progressive policyholders have 30 days to update their car insurance policy after purchasing a new vehicle. Within that period, your new car will be covered the way that your old vehicle was.
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