Zero Depreciation Car Insurance

With zero depreciation car insurance, a policyholder does not have to pay the depreciation value of the damaged or replaced parts of the car and can claim the full amount under their comprehensive car insurance.

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What is Zero Depreciation in Car Insurance?

A zero dep is an add-on cover under which the insurance company does not charge the depreciation sustained by the insured car. Under a nil depreciation add-on in car insurance, a policyholder can claim the total cost of repair or replacement of car parts, including their depreciated value, in case of accidental damage.

In simple words, zero depreciation car insurance means that the depreciation value of the damaged parts won't be deducted from the claim amount, and you will receive full compensation, thus ensuring huge savings. Moreover, this cover applies to vehicles up to 10 years old. The number of claims a policyholder can raise under a zero dep car insurance varies based on insurers.

Should You Opt for Zero Depreciation Car Insurance?

Here are some reasons to get a zero depreciation add-on with your four-wheeler insurance policy:

• New Car Owners: If you have bought a new car, it is recommended that you add a zero dep cover while buying a vehicle insurance policy for enhanced protection.
• Owners of Luxury Cars: Luxury cars have expensive parts that can incur significant costs for their repair or replacement during claims. Hence, opting for zero depreciation car insurance is advised to avoid these expenses and ensure savings.
• New Drivers: If you are a new driver, there are high chances of accidents due to lack of experience. Hence, you should buy a zero depreciation car insurance policy to save your out-of-pocket expenses.
• Those Living in High-risk Areas: You should consider buying a zero dep cover with your car insurance policy if you reside in an accident-prone area since there are higher risks of your vehicle getting damaged.

Benefits of Zero Depreciation Add-on in Car Insurance

Listed below are advantages of buying bumper to bumper protection with your motor insurance policy:

• Minimal Out-of-Pocket Expenses: A zero dep add-on helps reduce your out-of-pocket expenses to almost zero since it does not factor in the depreciation of your vehicle or its parts during claims.
• Nominal Additional Fee: You can opt for a nil dep add-on by paying a slightly higher premium for your car insurance policy.
• Peace of Mind: Adding a zero dep cover to your vehicle insurance policy enhances the overall coverage of your vehicle, ensuring stress-free driving and long-term savings.

What is not Covered Under a Zero Depreciation Add-on Cover?

While a zero depreciation add-on in car insurance offers comprehensive coverage for your vehicle, there are some exclusions that you should know:

• Total Loss or Theft: In case of a total loss or theft of your insured vehicle, your insurer will settle the claim based on your vehicle's IDV(Insured Declared Value), which would involve depreciation.
• Regular Wear and Tear: Any damage caused to your insured car by its usual wear and tear or electrical/mechanical failure is not covered under a zero dep add-on.
• Negligent Driving: Claims under your zero depreciation car insurance will be rejected if the driver is found to be driving without a valid licence or under the influence of alcohol or toxic substances.
• Vehicle Used for Purposes Other Than Intended: Damages sustained by your private vehicle when used for commercial purposes are also not covered under zero depreciation car insurance.

Zero Depreciation Car Insurance Vs Comprehensive Coverage

Below is a table stating the basic differences between a car insurance policy with zero depreciation add-on and a basic comprehensive car insurance policy:

Should I Buy Zero Depreciation Car Insurance after 7 Years?

Yes. Buying zero depreciation cover for your 7-year-old car is completely up to you. This add-on covers the total cost of repairs, even for older vehicles, without considering the vehicle depreciation, which is especially beneficial for expensive part repairs.

However, it's important to note that a zero dep add-on comes with a higher premium than standard comprehensive car insurance. Ultimately, purchasing this cover depends on your insurance requirements and budget.

How is Zero Depreciation Car Insurance Premium Determined?

These are the key factors taken into consideration while calculating premium for a zero dep car insurance policy:

• Age of the Vehicle: Your car's age is an important factor that impacts policy pricing. The older your vehicle, the higher its depreciation; consequently, your zero dep car insurance premium is also higher.
• Make, Model, Type: The make and model of a vehicle also affect the car insurance premium. A car with a larger cubic capacity and expensive parts will incur higher insurance costs.
• Location of Vehicle Registration: The cost of the zero depreciation car insurance premium is higher in metropolitan cities compared to other tier-2 cities.
• Accessories: If you have installed any separate accessories in your vehicle, you will have to pay additional charges for your zero dep car insurance policy.

Insurer-Wise Number of Zero Depreciation Claims

Cited below are the number of times policyholders can raise zero dep and non zero-dep claims against their four-wheeler insurance policy based on different insurers:

Disclaimer: This information is provided by Insurance providers. The table mentioned above is according to the alphabetical order of the insurance company. Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. For a complete list of insurers in India, refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in.

Car Depreciation Rates Approved by IRDAI

The vehicle deprecation rates in India are as per guidelines set by the Insurance Regulatory and Development Authority of India (IRDAI) every year. Here are tables showcasing the depreciation rates of cars and different car components:

How to Get Zero Depreciation Car Insurance Online?

To buy or renew zero depreciation insurance online, just follow this simple process:

• Visit Policybazaar.com and select 'Car Insurance' on the homepage.
• Enter your car number on the given form and select its make/model, variant, RTO, etc.
• Now, from the given four-wheeler insurance quotes, select a plan that suits your insurance needs and budget.
• Select 'Zero Depreciation' from the 'Addons' section.
• Now you will see the updated policy premium, which you can pay via available payment modes.
• After successful payment, your zero dep car insurance policy documents will be mailed to you.

Tips to Renew Zero Dep Car Insurance Online

Car insurance renewal with a zero dep cover is a simple and hassle-free process, especially when it is done online. Here are some tips to renew zero dep car insurance online:

• Keep a track of the renewal date: The insurer or the policy aggregator usually sends a reminder over a call or email. It is recommended for the policyholder to keep a record of the same so that the policy can be renewed before the due date.
• Enter the required policy details: While renewing zero depreciation car insurance online, there is no need of running from pillar to post for any paperwork, cheque submission, etc. It can be done online on Policybazaar.com by clicking on 'Renewal.' One just needs to choose the existing or new customer option, to begin the process.
• Follow the instructions: Submit all the required details, fill out the form and click on the payment option.
• Make the payment online: You can make the payment online using cards, net banking, or UPI.
• Renewal: The insurer will send an acknowledgement of the zero depreciation car insurance renewal on your registered email id and phone number.

Claim Settlement with Zero-Depreciation Car Insurance

At the time of claim settlement, the depreciation applicable to your car parts is mentioned in the policy wording. As mentioned above, if you don't have a zero dep add-on, you need to pay 50% depreciation on nylon, plastic, and rubber parts, including batteries, 30% on fibreglass components, and 5-10% on wooden parts.

However, if you already have zero depreciation car insurance, you are not required to pay anything to the insurer. As a result, you will receive the full claim amount without deducting the depreciation sustained by your car.

In the case of standard car insurance plans, the insurer only reimburses the loss after deducting the depreciation value of the replaced parts, unlike a nil depreciation car insurance policy.

Now that you are aware of the benefits of zero-dep car insurance, you can buy it as an add-on, so why not go ahead and buy it?

Why buy Zero Dep Car Insurance from Policybazaar Insurance Brokers Private Limited?

Here are some reasons to buy nil depreciation cover from Policybazaar.com:

• 24x7 Claims Assistance: Our claims experts are now available 24x7 to help you with claim intimation and status updates.
• Cashless Assurance: Call us or the insurer and you will get a "Delivery Order" for a cashless facility for repairs at any garage across India. In the rare cases of cashless not being provided to you, the claim reimbursement will be paid within 24/48 working hours post submitting documents/original invoice as mentioned against the respective Insurer.
• 3-Day Repair Assurance: Your car will be repaired at a trusted garage and will be delivered back to you within 3 working days.
• Free Pickup & Drop: You can call us when you need a claim and a garage partner will pick up and drop your car.
• Self Video Claims: We have made the claims process smoother. Simply upload a video of your damage through our claims app and we will take care of the rest.
• Windshield Claims At Home: You can call us for a windshield replacement claim and the garage partner will replace the windshield at your home itself.