Depreciation Waiver Car Insurance in Ontario: What OPCF 43 Covers for New Vehicles

Reviewed by Michelle Bragg, VP Personal Lines, RIBO Licensed | Last Reviewed: May 2026

If you are wondering what a depreciation waiver in car insurance is, it is an optional Ontario endorsement that protects a new vehicle from depreciation after a covered total loss. In Ontario, this coverage is commonly called OPCF 43 or a waiver of depreciation endorsement.

A depreciation waiver can help eligible drivers receive compensation based on the original purchase price, manufacturer’s suggested retail price, or the cost of replacing the vehicle with a comparable new model instead of receiving only the vehicle’s depreciated market value after an accident or theft.

This article is for general informational purposes only and does not provide legal, financial, or insurance advice. Ontario auto insurance coverages, endorsements, eligibility rules, deductibles, and claim settlement terms may vary by insurer and policy wording. Drivers should review their own policy documents and speak with a licensed insurance professional regarding their specific situation.

What Is Depreciation in Car Insurance?

Vehicle depreciation refers to the reduction in a car’s value over time due to age, mileage, wear, market demand, and overall condition. Unlike many homes that may increase in value, vehicles generally lose value steadily from the moment they are purchased.

According to the Canadian Black Book’s Mastering Modern Auto Valuation article, many new vehicles can lose approximately 25% of their value during the first year of ownership alone. Depreciation continues throughout the life of the vehicle, which directly affects insurance claim settlements when a vehicle is declared a total loss.

How Does Depreciation Affect an Ontario Insurance Claim?

Most Ontario auto insurance policies settle total loss claims using Actual Cash Value (ACV). This means the insurer pays what the vehicle was worth immediately before the loss occurred, not what was originally paid for the vehicle.

For example, if a family purchases a new SUV for $48,000 and the vehicle is stolen or written off two years later, the insurer may determine the vehicle’s market value has dropped significantly due to depreciation. Without a waiver of depreciation endorsement, the settlement may be thousands of dollars lower than the original purchase price.

This situation can create financial pressure for drivers who still have financing or lease obligations remaining on the vehicle.

What Is OPCF 43 in Ontario?

The Ontario Policy Change Form 43, commonly called OPCF 43, is an optional endorsement that removes the insurer’s right to deduct depreciation from a covered claim settlement during the coverage period.

Ontario drivers with OPCF 43 may receive compensation based on:

• The original purchase price
• The manufacturer’s suggested retail price (MSRP)
• The cost to replace the vehicle with a new comparable model, similarly equipped

The settlement method depends on the insurer’s policy wording and the endorsement terms.

The Financial Services Regulatory Authority of Ontario (FSRA) identifies OPCF endorsements as optional coverages Ontario drivers may add to their auto insurance policies.

What Does a Waiver of Depreciation Cover?

A waiver of depreciation endorsement typically applies when a vehicle experiences:

• A total loss after a collision
• Vehicle theft
• Fire damage
• Certain comprehensive losses
• Severe damage where repairs are not economically practical

Coverage generally applies only if the vehicle meets the insurer’s eligibility rules and the loss occurs while the endorsement remains active on the policy.

Does OPCF 43 Cover Partial Damage Claims?

Usually, OPCF 43 is designed primarily for total loss situations. However, some insurers may include additional benefits related to repair standards or replacement parts.

For example, insurers may provide original equipment manufacturer (OEM) parts during qualifying repairs for newer vehicles. Coverage details differ by insurer and policy wording.

How Does a Depreciation Waiver Work?

A depreciation waiver changes how the insurer calculates the value of the vehicle after a covered total loss.

Without OPCF 43:

• The insurer calculates the depreciated market value of the vehicle.

With OPCF 43:

• The insurer may settle the claim based on the original value or replacement value outlined in the endorsement.

This distinction can significantly reduce the financial gap between what drivers owe on a financed vehicle and the amount received from the insurance settlement.

Why Do Ontario Families Consider New Car Depreciation Insurance?

New vehicles often depreciate quickly during the first several years of ownership. Families who finance or lease newer vehicles may consider OPCF 43 because it can provide greater financial predictability after a serious loss.

According to the Insurance Bureau of Canada (IBC) How Auto Insurance Rates are Set article, repair costs, vehicle technology, theft trends, and replacement values continue to influence Canadian auto insurance claims and vehicle ownership costs.

For households managing car loans, replacement costs, childcare transportation, and commuting needs, a large depreciation gap after a total loss could create unexpected financial strain.

Who Qualifies for OPCF 43 Coverage in Ontario?

Eligibility requirements vary by insurer, but drivers commonly need to meet several conditions.

Is OPCF 43 Only Available for New Vehicles?

In many cases, yes. Most insurers reserve depreciation waiver coverage for:

• Brand-new vehicles
• Demonstrator or showroom vehicles with limited use
• Vehicles purchased directly from a dealership

Coverage eligibility often depends on the vehicle’s age and mileage at the time the endorsement is added.

Do You Need Collision and Comprehensive Coverage?

Most insurers require physical damage coverage before allowing OPCF 43 to be added. This usually means carrying:

• Collision coverage
• Comprehensive coverage
• Or All Perils coverage

Without these underlying coverages, the waiver of depreciation endorsement generally cannot apply.

Can Leased Vehicles Qualify?

Yes. Ontario insurers may offer:

• OPCF 43 for owned or financed vehicles
• OPCF 43A for leased vehicles

Drivers leasing a new vehicle should review the lease agreement carefully because settlement obligations may differ from financed ownership arrangements.

How Long Does a Waiver of Depreciation Last?

Most depreciation waiver endorsements apply for a limited period only.

Coverage durations commonly range from:

• 24 months
• 36 months
• 48 months

The exact timeline depends on the insurer and the policy wording.

Once the endorsement expires, future claims are generally settled based on the depreciated Actual Cash Value again.

What Is a Limited Waiver of Depreciation?

Some insurers offer limited waiver endorsements with shorter protection periods or additional restrictions.

A limited waiver may:

• Apply for fewer years
• Restrict settlement calculations
• Include mileage conditions
• Limit eligibility to specific vehicle types

Ontario drivers should review the endorsement wording carefully to understand how long protection lasts and how claims are settled.

What Is the Difference Between Actual Cash Value and Replacement Cost?

Actual Cash Value (ACV)

Actual Cash Value reflects the vehicle’s market value immediately before the loss occurred. Depreciation is included in the calculation.

Factors may include:

• Vehicle age
• Mileage
• Condition
• Market demand
• Previous damage history

Replacement Cost

Replacement cost coverage aims to provide enough compensation to replace the vehicle with a similar new model or compensate based on the original insured value outlined in the endorsement.

OPCF 43 helps bridge the gap between depreciated value and replacement value for qualifying vehicles.

Does a Depreciation Waiver Eliminate Your Deductible?

No. Drivers are still generally responsible for paying their deductible when a claim is covered under OPCF 43.

The endorsement changes how the vehicle value is calculated, but it does not normally remove the deductible selected on the policy.

What Is Not Covered Under OPCF 43?

Coverage exclusions vary, but depreciation waiver endorsements commonly do not include:

• Winter tires
• Aftermarket modifications
• Custom accessories
• Wear-and-tear items
• Batteries
• Mechanical breakdowns unrelated to insured losses

Drivers should also understand that coverage applies only while the endorsement remains active and while all policy conditions are met.

Is a Waiver of Depreciation Worth It?

Whether OPCF 43 makes sense depends on the driver’s financial situation, vehicle financing arrangement, and comfort level with depreciation risk.

Families often consider this endorsement when:

• Purchasing a new vehicle
• Financing a vehicle over several years
• Leasing a higher-value vehicle
• Replacing a vehicle would create financial strain
• Vehicle values are expected to depreciate quickly

Ontario drivers may benefit from reviewing their policy regularly as their vehicle ages and their insurance needs change.

If you are reviewing coverage options for a newer vehicle, you can learn more on our website to better understand available Ontario auto insurance coverages.

How Can Drivers Compare Ontario Car Insurance Coverage?

Insurance endorsements and policy wording can differ significantly between insurers.

When reviewing new car depreciation insurance Canada options, drivers may wish to compare:

• Eligibility requirements
• Coverage duration
• Deductible options
• Replacement value wording
• OEM parts availability
• Lease versus ownership rules

Families comparing Ontario policies may also benefit from talking to a professional BIG Broker and requesting a quote to ensure their coverage aligns with their vehicle financing and household needs.

Drivers researching additional Ontario auto insurance protection can also review these resources for broader policy information and coverage comparisons.

What Should Ontario Drivers Ask Before Adding OPCF 43?

Before adding a depreciation waiver endorsement, drivers may wish to ask:

• How long does coverage remain active?
• What settlement method does the insurer use?
• Are demonstrator vehicles eligible?
• Are OEM replacement parts included?
• Does coverage transfer if switching insurers?
• What documents are required for eligibility?

Keeping a copy of the bill of sale and financing documents may help simplify the underwriting and claims process.

Frequently Asked Questions About Depreciation Waiver Car Insurance Ontario

What is a depreciation waiver in car insurance?

A depreciation waiver is an optional endorsement that allows eligible Ontario drivers to receive compensation without depreciation being deducted after a covered total loss involving a newer vehicle.

What does OPCF 43 mean in Ontario?

OPCF 43 stands for Ontario Policy Change Form 43, which is the official endorsement used for waiver of depreciation coverage on qualifying vehicles.

How long does OPCF 43 coverage last?

Most insurers offer OPCF 43 coverage for approximately 24 to 48 months, depending on the vehicle and insurer guidelines.

Can you get OPCF 43 on a used vehicle?

Some insurers may allow limited eligibility for demonstrator vehicles, but most waiver of depreciation endorsements are intended for brand-new vehicles.

Does OPCF 43 cover theft?

Yes. If a qualifying vehicle is stolen and declared a total loss, OPCF 43 may allow settlement without depreciation being deducted.

Is a depreciation waiver mandatory in Ontario?

No. OPCF 43 is optional coverage and is not legally required under Ontario auto insurance rules.

Blog Updated: June 2026