Zero Depreciation Car’s Insurance: How It Benefits You, How to Apply and How to Claim!
Having a car insurance policy that covers you against any unforeseen damages or losses is essential. However, a standard car insurance policy may not cover several situations or factors like depreciation. That’s where zero depreciation car insurance comes in. You can add a zero depreciation add-on cover to your standard car insurance policy for enhanced coverage.
What is Zero Depreciation Car Insurance?
Depreciation refers to a decline in the value of your car parts over time. In a standard car insurance policy, when you claim damages, the insurance company credits an amount to your account after considering the car’s depreciation. However, if you have zero depreciation insurance coverage on the car, the company covers the full cost of repair or damage of car parts without considering the depreciation. Zero depreciation car’s insurance is an add-on cover that offers you total coverage of your car parts without any deduction due to depreciation.
Benefits of Zero Depreciation Car’s Insurance
Some of these benefits of zero depreciation insurance include the following:
- Reduced Expenses
Zero depreciation insurance on a car reduces your out-of-pocket expenses. Since you do not have to pay for repairing the damaged parts of your car, the expenditures are significantly low.
- IDV Boost
IDV, which stands for Insured Declared Value, is the total amount you can claim in case of total loss or theft of your car. Zero depreciation car’s insurance can boost the value of your IDV.
- Multifaceted Benefits
It is beneficial for new and luxury cars because they are expensive, and over time, with wear and tear, the value of their parts will decrease, forcing you to claim a low amount. It is also beneficial for frequent drivers because they are more accident-prone.
What Does Zero Depreciation Insurance on a Car Cover?
The zero depreciation insurance on a car covers the damages caused by the following factors:
- Repair and Replacement of Some Parts
The zero depreciation car’s insurance add-on covers the repair and replacement costs of rubber, plastic, fibre, glass, and nylon. These parts generally have a high depreciation value, as listed in the table below:
| Parts | Depreciation rate |
| Glass | Nil |
| Fibreglass | 30% |
| Rubber, Nylon, and Plastic Parts | 50% |
- Damage Caused by Unforeseen Calamities
The zero depreciation insurance on a car covers the damage and loss caused by natural or man-made calamities, such as earthquakes, fires, riots, and vandalism.
- Damage Caused by Accidents
An accident is one of the most common causes of damage to a car and its parts. Zero depreciation insurance on a car covers everything, whether a minor dent or a major car accident.
- Damage Caused by Transit
Here, transit refers to your car being transported from one place to another via road, rail, air, or water. Mishandling during loading and unloading can cause damage to your vehicle. Zero depreciation car’s insurance covers the damages caused in this case.
What Does Zero Depreciation Insurance On a Car Not Cover?
The zero depreciation insurance on a car does not cover the following damages:
- Damage due to Mechanical or Electrical Breakdown
A mechanical or electrical breakdown refers to the malfunctioning or failure of your car due to faulty design, manufacturing defects, improper installation, or lack of maintenance.
- Damage due to Negligence and Misuse
The insurance add-on does not cover the expense if you damage your car due to negligence or misuse.
- Damage due to War or Nuclear Risk
Events like civil war, military coup, rebellion, revolution, nuclear contamination, and explosions are beyond anyone’s control, and the add-on cover does not include them.
- Damage Under Alcohol or Drug Influence
Alcohol or drugs can impair vision, reaction timing, and judgement, causing damage to the car and others. It is a severe offence, and the add-on cover does not include coverage for the same.
- Damage to the Engine Due to Oil Leakage or Water Ingression
Engine damage is one of the costliest damage that can affect your car. It can happen due to oil leakage, water ingress, overheating, faulty parts, etc. The insurance add-on does not cover these damages.
How to Purchase Zero Depreciation Insurance On Cars Online?
To choose a suitable zero depreciation insurance on cars, follow these steps:
- Compare Different Plans
You can compare various insurers online by visiting their official websites. Compare the features, benefits, coverage, and premiums of different plans. Pick the option that works best for your needs and budget. Comparing customer reviews and ratings can also give you an idea about the quality of the insurer’s services.
- Select the Plan and Add-on
Once you have compared different plans, select the one that suits you the best and add it as an add-on cover. Zero depreciation insurance on a car is an optional cover that you can buy with a comprehensive or stand-alone car insurance policy. Also, note that Zero depreciation insurance on a car cannot be purchased with a third-party insurance plan.
- Share Your Details
Once you have selected the plan and add-on coverage, share the details with your insurer, including your car registration number, relevant personal information, previous car policy details, etc. You must declare any modifications or accessories installed in your car. You also need to select the IDV of your vehicle, which is the maximum amount you can claim in case of an accident, total loss, or theft of your car.
- Make Payment
The final step is to complete the payment using the method that suits you best. Once you have completed the payment, you will receive a confirmation email and SMS with your policy number and documents.
How to Make a Claim For Zero Depreciation Insurance on a Cars?
You can claim zero depreciation insurance on a car by following the procedures outlined below.
Inform your Insurer
As soon as your car gets damaged or meets with an accident, you should inform your insurer about the incident and the extent of the damage. You should also notify your insurer that you have zero depreciation insurance on the car as an add-on to your policy. It will help your insurer to process your claim faster and more efficiently.
Register your Claim
You should register your claim online or offline by providing the necessary details and documents, such as your policy number, car registration number, driving licence, FIR (if applicable), etc. You also need to choose between cashless or non-cash (reimbursement) claims. A cashless claim allows you to repair your car at a network garage without paying anything from your pocket. A reimbursement claim demands submission of the bills and receipts to your insurer for reimbursement. Read more...