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Frequent Contributor
Posts: 106

Zero depreciation in car insurance

What is zero depreciation in car insurance?

10 REPLIES
Frequent Contributor
Posts: 119

Re: Zero depreciation in car insurance

Hi Hayat,

 

As the term implies, zero depreciation cover promises comprehensive coverage without factoring in for depreciation. If your car is damaged following a collision, for instance, and you file a claim, the insurer will cover the entire cost.

Anuj Shergil
Frequent Contributor
Posts: 88

Re: Zero depreciation in car insurance

Hayat said it rightly, As the term implies, zero depreciation cover promises comprehensive coverage without factoring in for depreciation. If your car is damaged following a collision, for instance, and you file a claim, the insurer will cover the entire cost.

NARESHKJAIN
New Member
Posts: 1

Re: Zero depreciation in car insurance

zero depreciation cover promises comprehensive coverage without factoring in for depreciation. If your car is damaged following a collision, for instance, and you file a claim, the insurer will cover the entire cost

Vartika sadhota
New Contributor
Posts: 2

Re: Zero depreciation in car insurance

As the term implies, zero depreciation cover promises comprehensive coverage without factoring in for depreciation. If your car is damaged following a collision, for instance, and you file a claim, the insurer will cover the entire cost.
jagjeet Kaur
New Contributor
Posts: 3

Re: Zero depreciation in car insurance

Hi. In motor Insurance, at the time of a claim, depreciation is calculated on the certain type of parts like - plastic/fiber, rubber, paint, etc. depending on the make & age of the vehicle.
As the name suggests, Zero depreciation means that at the time of a claim, depreciation is considered to be ZERO on these parts and claim is paid in full (subject to the maximum declared value of the vehicle)
There are other add-on to a ZERO depreciation cover - like consumables cover, return to invoice cover etc.
You can read in the policy conditions of any General Insurance Company
jagjeet Kaur
New Contributor
Posts: 3

Re: Zero depreciation in car insurance

Hi. In motor Insurance, at the time of a claim, depreciation is calculated on the certain type of parts like - plastic/fiber, rubber, paint, etc. depending on the make & age of the vehicle.
As the name suggests, Zero depreciation means that at the time of a claim, depreciation is considered to be ZERO on these parts and claim is paid in full (subject to the maximum declared value of the vehicle)
There are other add-on to a ZERO depreciation cover - like consumables cover, return to invoice cover etc.
You can read in the policy conditions of any General Insurance Company
jagjeet Kaur
New Contributor
Posts: 3

Re: Zero depreciation in car insurance -

Hi. In motor Insurance, at the time of a claim, depreciation is calculated on the certain type of parts like - plastic/fiber, rubber, paint, etc. depending on the make & age of the vehicle.
As the name suggests, Zero depreciation means that at the time of a claim, depreciation is considered to be ZERO on these parts and claim is paid in full (subject to the maximum declared value of the vehicle)
There are other add-on to a ZERO depreciation cover - like consumables cover, return to invoice cover etc.
You can read in the policy conditions of any General Insurance Company
Vartika sadhota
New Contributor
Posts: 2

Re: Zero depreciation in car insurance

Zero depreciation cover, also called ‘zero dep’ policy, offers complete coverage without factoring in depreciation. It means, if your car gets damaged following a collision, you will receive the entire cost from the insurer

A car insurance with zero depreciation cover helps protect your car against all physical damages caused to the car without factoring in the element of depreciation. Although a standard motor insurance policy covers you against losses arising in case your car is damaged or stolen but when you file for a claim settlement, the compensation is received after a standard deduction of depreciation.

On the other hand, a car insurance​ with zero depreciation cover can fetch you the entire compensation amount. A zero depreciation add-on cover can be availed for brand new vehicles and also can be opted for at the time of policy renewal.

In a car insurance zero depreciation policy, the entire claim amount is paid by the Car Insurance Company without considering the depreciation on the value of the car. Obviously, you have to pay slightly more in terms of your premium. However, this add-on feature is highly recommended to everyone considering the fact that it eliminates the possibility of any out-of-pocket expense from the owner.
Mumpy Das
Occasional Contributor
Posts: 12
Solution

Re: Zero depreciation in car insurance

Zero dep is the most popular add-on in Motor Comprehensive Policies these days.
Have you ever wondered why Zero Dep is on trend than other add-ons like NCB protection which don’t let the NCB bones decline when you claim? The Biggest reason for Zero Dep to be so popular is because it gives you full claim amount on the parts whose value otherwise have been of less value because of getting old(by years).I am sure you know what depreciation means, it is the sign that our vehicle is getting older, it is the cost that insurance company cut from the whole amount of wear and tear.
However, Zero Dep add-on is highly recommended for wider coverage, But then again there are various factors which shall be considered while buying Zero Dep, add-on.
Like: It increases the premium, it is available for the cars not older than 5 years, then there are restrictions on the no of claims made(which vary insurer to insurer).
Let's see what IRDA guidelines have to say about Zero Depreciation.
By the way, IRDA is the regulatory body which governs all insurance companies
“To protect the policyholders’ interests, to promote, regulate and ensure that the growth of the insurance industry is orderly and for all matters associated therewith or incidental thereto,” that’s IRDA’s mission.
IRDA decides the depreciation rates. Read this Handbook by IRDA for more clarity. https://irdai.gov.in/ADMINCMS/cms/Uploadedfiles/NLP1415/73.pdf
Anyway, I am sure till now you would be very curious to know what exactly are the benefits of Zero Depreciation Add-on.
Buying a zero dep with the base comprehensive plan can be little expensive, but the savings in case of repairs after an accident may often mitigate this additional cost.
Not just financially but even emotionally it keeps you light-minded at times of difficulties if your car is damaged and require repair.
Even if you already have Motor Insurance Policy, you should definitely check out the rates and coverages of the Comprehensive Motor Insurance Policy with Zero Depreciation add-on on this link easily: http://bit.ly/2DPJm2P