Greenwich Policy Pays for New Car
A California broker has introduced an auto insurance policy that will pay for a new car to replace one stolen or ruined.
The insurance, called Totaled Protection, covers the difference between the cash value of an insurance policy and the cost of purchasing a new automobile.
About 25 lenders have agreed or are negotiating to build the policy into auto loan packages, said Michael Valentiner, chairman of Greenwich F & I Services, Los Angeles, a unit of the Greenwich Group. The product is insured through Transamerica Premier Insurance Co., a unit of Transamerica Corp., San Francisco
For bankers, the policy is attractive because it helps them maintain collateral. When the policy is paid out, automobile lenders can use the replacement car as collateral on the original loan.
Mr. Valentiner said the typical price is about $350 for two years of coverage. Some upscale cars that are popular theft targets and some inexpensive cars in which consumers have little equity are excluded from the insurance program.
About 120 consumers in California have signed up for the program, which was introduced in March, Mr. Valentiner said.