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About Ontario’s Depreciation Deduction

The 'depreciation' covered in Ontario's optional 'OPCF 43 Removing Depreciation Deduction' coverage is not the depreciation due to the collision, it is the depreciation due to the passing of time that occurred before the collision.

(Note, this coverage only applies to the first 24 months of ownership of a new vehicle and only when the accident causes the vehicle to be a write off, a total loss, and you have the optional insurance that covers a write off.)

For example, you buy a brand new SUV for $40,000. Six months later your SUV is worth maybe $32,000 because of the natural depreciation of the vehicle. You have an accident in which your SUV is a write off. If you have the optional OPCF 43 coverage the insurance company will pay you the original price of the SUV, the $40,000, instead of the $32,000 it was worth right before the accident. So it is covering the $8000 in natural depreciation due to time passing before the accident.

Nothing to do with the depreciation in value that occurs because of an accident.

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