Loss of use endorsements explained

What are OPCF 20, QEF 20, and SEF 20?

OPCF 20 in Ontario, QEF 20 in Quebec, and SEF 20 in Alberta are optional car insurance endorsements. Endorsements are amendments to an insurance policy, which add, remove, or change the policy’s default coverage. You may see these particular endorsements called Coverage for Transportation Replacement in Ontario, Travel Expenses in Quebec, or the Loss of Use Endorsement in Alberta.

These endorsements provide loss of use coverage. That means they compensate you for extra transportation expenses you need to pay if your vehicle gets damaged, but only if the damage is covered by your policy. It also applies if your vehicle gets stolen, assuming you have coverage for theft.

If you have any of these endorsements, they will cover reasonable expenses for renting a replacement vehicle while your regular car is unusable. They’ll also cover reasonable taxi or public transit fares if needed.

How do OPCF 20, QEF 20, and SEF 20 work?

First and foremost, loss of use endorsements are optional. That means you need to add them to your car insurance policy if you want to use them.

The only exception is if your car is stolen; loss of use coverage for theft of your vehicle comes alongside theft coverage that you get through optional comprehensive, all perils, or specified perils coverage. OPCF 20, QEF 20, and SEF 20 replace that theft-only coverage, expanding loss of use to any loss that your policy covers.

So, to make the most of these endorsements, you’ll probably want to have optional damage coverages like collision and comprehensive (or two-way insurance in Quebec).

For example, say you live in Ontario and your vehicle gets damaged in a collision that’s your fault. Your optional collision coverage would pay to repair your car. Your optional OPCF 20 would pay for a rental car while your car is in the shop. If you didn’t have OPCF 20, the repairs would still be covered, but you’d have to pay for your own rental car. If you didn’t have collision coverage, you’d have to pay for everything. It works the same way with other damage coverages like DCPD or comprehensive.

If your vehicle gets damaged, make sure to contact your insurance provider before you start racking up rental car or taxi charges. They’ll confirm whether you’re eligible for loss of use coverage.

Loss of use endorsement limitations

Loss of use endorsements only cover reasonable transportation expenses. Mainly, that means your replacement car will have to be similar to your regular car. Your insurer won’t pay for you to drive around in a G-Wagon while your Corolla is in the shop. There’s also no coverage for fuel costs, as you’d ordinarily pay those for your own vehicle anyway.

You can only use loss of use endorsements if the cost of the damage to your car is greater than the applicable deductible.

They have a dollar limit, too. You’ll typically be able to choose this limit when you buy your policy. The limit is usually per-occurrence, which means you can spend that much on alternative transportation for each claim you make. There may also be a per-day limit.

OPCF 20, QEF 20, or SEF 20 coverage will end when one of three things happen:

1. Your vehicle’s repairs are complete.
2. You have a permanent replacement vehicle.
3. Your insurer offers you a cash settlement for your totaled car.
4. You reach your coverage limit.

The loss of use endorsements only apply to individual vehicles. So, if you’re insuring multiple vehicles on the same insurance policy, you’ll need to add the endorsement for each car (assuming you want loss of use coverage for every car).

It’s important to note that loss of use does not cover rental car insurance. If you have rental car coverage, your policy will cover the rental car. Rental car coverage is another available endorsement — OPCF 27 in Ontario, QEF 27 in Quebec, and SEF 27 in Alberta. If you don’t have rental car coverage, you’ll need to secure rental car insurance elsewhere.

Do you need loss of use coverage?

OPCF 20, QEF 20, and SEF 20 are all optional endorsements.

However, it’s wise to add them to your policy. To start with, the loss of use endorsements tend to be affordable — most drivers pay less than $100 per year. You can get a car insurance quote online from Square One to see how much you’d pay for car insurance with the loss of use endorsement included.

Rental cars are expensive. But, if your vehicle gets damaged, you still need to get around while it’s at the repair shop. One accident can make several years of loss of use endorsement payments worthwhile.

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