Common use of By Replacement Clause in Contracts

By Replacement. If we decide your snowmobile must be replaced because of its loss, settlement will be as follows: (a) If the loss or damage happens within the first 24 months from the date you took delivery of the snowmobile and you choose a brand new snowmobile of the same make and model with similar equipment (colour may vary), we will replace your snowmobile. If the same model year is not available, we will replace your vehicle with the next model year available. (b) If you choose a different make or model that is brand new with a value lower than shown on the Summary of Coverage page, we will only pay you our cost to replace the snowmobile with a new snowmobile of your choice. (c) If you choose a different make or model that is brand new with a higher value than shown on the Summary of Coverage page, or this is a leased vehicle, we will only pay you up to the original purchase price of the snowmobile as shown on the Summary of Coverage page. (d) If the loss or damage happens and we cannot replace the snowmobile covered because the same or similar make and model are no longer produced or manufactured, we will pay you the original purchase price (including applicable taxes). 1. Your snowmobile must be continuously insured for Replacement Cost Coverage with us or another insurance company. You must obtain this coverage within 120 days after the date you took delivery of the snowmobile. Coverage under this endorsement shall not be in effect for more than 24 months after that delivery date. The snowmobile must have been: (a) bought new, (b) leased new, or (c) owned and used as a demonstrator by a snowmobile dealership. You must have bought the snowmobile within 12 months of the date the dealer first put it into service as a demonstrator. 2. It is up to us to decide if your snowmobile is to be repaired or replaced.