Bike Insurance Add-ons: Zero Depreciation Cover V/s Return to Invoice Cover

Zero Depreciation Cover in Bike Insurance

You must be aware of the term 'depreciation' whenever you buy a motor vehicle. In two-wheelers, depreciation means the wear & tear of bike’s parts over time. As the value of the bike depreciates, it has a direct impact on the claims.

So, what is this "Zero Depreciation Cover" all about? Well, it is a value-for-money add-on cover that makes your bike feel brand new again without burning a hole in your pocket. It is also known as "bumper-to-bumper insurance" because it covers the depreciation of your bike's parts, ensuring you do not have to pay the bill for regular wear and tear of the bike's parts.

Here are the key takeaways about Zero Depreciation cover:

• This add-on cover is available for bikes under 5 years old.
• Before your claim is settled, deductibles (both mandatory and voluntary) will be deducted.
• You have to pay an additional premium to buy Zero Depreciation add-on cover.

Return to Invoice (RTI) Cover in Bike Insurance

Your two wheeler insurance depends on the approximate market value of the bike, commonly known as Insured Declared Value (IDV) in the insurance industry. If your bike is damaged beyond repair in an accident or is stolen, then you will receive declared IDV of your motorcycle after considering the depreciation factor and deductibles.

However, if you own a 'Return to Invoice' cover, you will receive the amount that you spent while purchasing the bike in the first place. In simpler terms, it bridges the gap between the IDV and the bike's purchase value (including registration charges and road tax). Hence, you will get the maximum compensatory amount, not the IDV, in case of total loss or theft of the insured bike.

Here are the key pointers about the Return to Invoice cover:

• It is applicable when the repair cost (as per policy terms) is more than 75% of the IDV.
• This add-on cover kicks in when your bike is stolen or is declared a total loss.
• It is a lifesaver for those living in high-accident zones or areas with a vulnerability for bike theft.
• Like Zero Depreciation cover, you will need to pay an extra premium to enjoy the benefits of RTI cover.

Zero Depreciation vs. Return to Invoice Cover in Bike Insurance

Both of these add-on covers aim to lessen the financial burden. However, they have their unique specifications. Check out the differences in the table below:

You may also read Return-to-Invoice Cover in Bike Insurance

Final words!

Both add-ons have always played a crucial role in enhancing policy coverage since they cover the losses that the base policy ignores. However, if you plan to buy these covers, ensure that you choose as per your requirements.