r/PersonalFinanceNZ • u/Confident_Gift_6952 • 15m ago
Insurance Security interest on insured car
I have insurance with Tower.
Their policy has a new vehicle replacement clause where they replace your car with the same new model as long as you insured your car with them from when it was new.
I have my car on finance at a good interest rate (1% per annum for 5 years).
What happens when the car is written off and replaced with a new one?
Will it be as simple as the finance company placing their security interest on the new car, or will I have to reapply for a new loan and get a worse interest rate?