Auto Replacement Endorsement — What Is It and Why?

In January 2024, I had a customer who was driving a 2014 Honda Civic DX purchased two years earlier and 100,000 miles ago, who had an accident during a snowstorm. It turned out the damage repair estimate of $9,500 exceeded the pre-accident value of the car. Keep in mind the insured had paid approximately $11,000 when it was purchased. So the Allstate totality department offered $10,200, which the insured felt was more than fair. Fortunately for our insured, he had purchased the Auto Replacement Endorsement. His version — offered for the first 15 years of the model life of the car — provided retail replacement value based on the value of a one-year-newer and 15,000-fewer-miles equivalent vehicle.

How Totality Is Determined

As I understand it, the totality is determined through the use of a third party that actively monitors the previous year, make, and model for all types of vehicles and what they were settled for by numerous carriers in aggregate.

One can visit the Revised Code of Washington (RCW) for both how a total loss is determined — WAC 284-40-320(18) — and what is paid out to the insured — WAC 284-30-391.

That would mean the actual cash value of the pre-accident condition needs to be determined and should be within 150 miles for comparative data, which is seemingly always in arrears based on what had been paid previously.

The huge difference — and a potential used inventory shortage of popular models — could in fact mean the cost to replace your vehicle would be more than the totality value to replace it.

Real Results

The Honda owner received more than $2,000 above the initial totality offer. He had paid less than $10.00 per six-month policy period — $20 for the year — to have this extra protection.

Last week we had an insured through another office with the same additional benefit on a 2012 Ford Escape have her vehicle totaled at $6,351.80. She too paid an extra $4.83 of her policy premium every six months to be afforded the extra added protection. As a result of the further evaluation, she was paid $9,580.07 — that was $3,228.27 more than the totality number. Pretty amazing.

What Changed in March 2025

In an effort to provide total disclosure: with the introduction of the new auto policy in Washington in March 2025, as an agent I feared we would cut this benefit from our offering. They did reduce the years of coverage to the first seven years of the model. Keep in mind only a few carriers have offered something similar for a maximum of four years from what I have read.

When you couple this with Accident Forgiveness and Drivewise, you may find that even if we are a few dollars more, there is almost no comparison for the thousands in extra dollars we may pay out — and also protect you from paying in future premiums after an accident.

Of course, every situation is different for each customer, and getting a quote is still free to each consumer regardless of the time spent by us to get new business.

Great news for existing auto policies issued prior to March 2025 and active in Washington — you may still be eligible for the 15-year version of the benefit.

Call us at 360-746-7785 to find out if your auto qualifies.