Is zero depreciation cover necessary?

Asked by: Alize Cormier  |  Last update: April 30, 2023
Score: 4.3/5 (40 votes)

As far as possible it is advisable for new cars (up to three years) to opt for zero-depreciation car policy. Better to pay a little more (premium) than to pay a lot more (repairs). Zero-depreciation is a good deal even if you have to pay a little extra.

Do we need zero DEP insurance?

A zero depreciation cover is an optional addon you can opt for in your car insurance policy. Having this addon in your plan ensures your insurer won't charge for your car's depreciation during claims and hence, you won't be liable to pay for the cost of depreciation of your car's parts during claims.

What is the benefit of zero depreciation car insurance?

With zero depreciation coverage, the insured does not have to pay the depreciation value of the damaged or replaced parts and the policyholder can claim. It applies to vehicles that are less than 5 years old and the policyholder can avail of it twice during the policy tenure.

What is not covered by zero depreciation insurance?

Zero depreciation car insurance policy offers 100% coverage for all fibre, rubber and metal parts without deduction of depreciation. It does not cover engine damage due to water ingression or oil leakage. Any mechanical breakdown, oil change or consumables are also not covered in this policy.

Is zero dep not available after 5 years?

Depreciation for calculating IDV

However, for vehicles older than five years, or the models that are discontinued by the manufacturer, such an IDV is decided mutually by the insurance company and you, the policyholder. Thus, the cover for zero dep car insurance after 5 years is not available generally.

What is Zero Depreciation Cover? [Explained]

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Does old car need zero depreciation?

Factors Affecting the Zero-Dep Premium

These are: Age of Car - Older the car, the more is the car premium. Most insurers don't offer zero depreciation cover for cars older than five years while some have even restricted it up to three years. However, a few insurers have also started offering a 7-year zero dep cover.

Is zero depreciation Same as bumper to bumper?

Zero depreciation cover and bumper to bumper cover are the same thing. They are just two names for a car insurance add-on which insures a policyholder against the depreciation cost of his/her insured's car. Zero Depreciation or Bumper to Bumper plan covers the full cost of replacement.

Are Tyres covered in zero DEP insurance?

A zero depreciation add-on covers all parts of your car at 100% except tyres, tubes and batteries which are covered at 50%.

Should I increase IDV value?

Getting an IDV that is close to the market value of your car is always the best bet. Decreasing the IDV value will result in lower premium but it also provides you with a lower coverage than is required. As your car grows older, the IDV decreases as it is.

How many times can you claim 0 DEP?

You can claim zero depreciation car insurance a maximum of two times during the tenure of your car insurance plan.

Is bumper covered in zero depreciation?

Bumper to bumper car insurance or full-body insurance provides full coverage for all rubber, fibre, and metal parts of your car without deducting the depreciation value. However, it will not cover engine damage resulting from oil leakage or water ingression.

Which insurance company gives zero DEP after 5 years?

TATA AIG Zero Depreciation Cover

The most popular one among them is the zero depreciation add-on. The zero depreciation add-on, also known as bumper to bumper add-on and nil depreciation add-on, provides coverage against the depreciation applicable on your car and its parts.

What is the difference between zero DEP and comprehensive insurance?

The Comprehensive Insurance Plan is an all-inclusive insurance plan. In an unfortunate event, it offers coverage to the policyholder's automobile, the policyholder and also covers third party damage. Zero Depreciation is primarily an add on feature which one can add to their comprehensive insurance plan.

Can I get a zero depreciation car insurance after 10 years?

1. Cars older than 10 years old. This is one of the first things that are excluded from the cover of zero depreciation car insurance policies. If your car is older than 10 years old, it cannot be covered by a zero dep car insurance policy.

Does IDV matter in car insurance?

The IDV is the key to the amount of motor insurance premium that you will pay for your car insurance. This is because IDV reflects the current market value of your car and mirrors the liability of your motor insurance company at the time of claim settlement.

Is personal accident cover mandatory?

Ans: Yes, as per the India Motor Tariff 2002, it is mandatory to purchase a personal accident cover. The car owner car can purchase this policy with third-party liability cover as well.

How can I reduce IDV?

Insured Declared Value (IDV) means the maximum value for which your car is insured in case of total loss/theft in a particular year. This value normally decreases as the car depreciates over its lifespan.

Will IDV decrease every year?

The depreciation factor reduces the IDV claim every passing year, and so does its premium. Within the first six months of the new vehicle, the value of the car depreciates by 5%. If a vehicle is more than five years old, its price is determined by mutual discussion between both the parties (car owner and insurer).

Does insurance claim reduce IDV?

Myth 1 - IDV is the maximum claim limit for 1 year

But you should remember that total loss claims also mandate that you pay the compulsory deductibles amount. If the claim amount is less than 75% of the IDV of your car, then you will have to bear the compulsory deductibles and depreciation of replaced car parts.

Is painting covered in car insurance?

Various factors go into deciding whether you can or should claim insurance on your car body/paint repairs namely: Extent of damage: as a thumb rule, consider insurance claims only if repair and painting is needed for more than 2 body panels (or Rs 6000+ in repair charges)

Is clutch plate covered under insurance?

The policy does not cover damage to the car engine due to water ingression or oil leakage, and standard wear and tear to components such as tyres, clutch plates, bearings, etc.

Does zero DEP cover paint?

If you have opted for an add-on cover such as zero depreciation also known as 'Nil-Dep cover', you need not pay for any depreciation charges towards motor repairs which include painting, rubber part replacement, glass or fiber replacement.

Does zero DEP cover plastic parts?

Zero Depreciation – What Does It Cover? This Add-On cover offers 100% coverage for all kinds of fibre, rubber, plastic, and metal parts without deducting any amount by way of depreciation.

Is bumper to bumper insurance compulsory?

On Monday, the court decided to modify its order, which had said that whenever a new vehicle is sold after 1.9. 2021, it is mandatory for coverage of bumper-to-bumper insurance every year, in addition to covering the driver, passengers, and owner of the vehicle, for a period of five years.