Zero Depreciation
Car Insurance
-
Up to 90% Discount*
-
11,000+ Network Garages*
-
AI-Assisted Claims on Self-i*
What is Zero Depreciation Car Insurance?
Zero depreciation car insurance is a type of add-on cover that ensures that you receive the full sum insured at the time of claiming your car insurance. Depreciation in motor insurance often refers to the loss in value of an asset over time due to factors such as age, wear and tear, and obsolescence.
However, with our nil depreciation cover, you receive the claim amount without the depreciation deduction, giving you the benefit of full coverage. Here is a comprehensive guide detailing zero depreciation insurance, its features, inclusions, and benefits.
Zero Depreciation in car insurance, also known as bumper-to-bumper or nil depreciation cover, is an add-on policy that ensures the policyholder receives the full claim amount without any deduction for depreciation on replaced parts. It is available with our standalone own-damage and comprehensive car insurance policies.
Zero depreciation means that when you claim your insurance, you receive the entire claim amount from the sum insured for the repair or replacement costs of car parts. Normally, when you file a claim for damages, the insurer deducts a certain percentage based on the depreciation of the car parts, especially those made of plastic, rubber and metal. With this add-on, the deduction is waived off, allowing you to get a higher reimbursement.
This add-on is particularly beneficial for new car owners or those with high-end vehicles, as it offers more comprehensive financial protection. However, it is important to note that this cover typically comes with a higher premium and might not cover all types of damages, like general wear and tear. It is ideal for those seeking to minimise out-of-pocket expenses in case of a claim.
How Does Zero Depreciation Insurance Work?
Depreciation refers to the deduction of the value of the asset over time due to wear and tear, ageing or usage. Vehicles, in general, are depreciating assets. For example, a new car will cost more than an older one.
Similarly, there is a certain depreciation associated with all the parts the car is made of. Parts made of plastic, metal, and fibre typically lose value over time, and each part has a different rate of depreciation.
This directly affects the car insurance premiums and claim amount, as insurers consider this amount and only pay for the replaced parts after deducting the depreciation amount from the claim amount. The insured person has to pay for the difference between the market value of the new part and the depreciated part of the car.
As a result, you receive less coverage and pay for the expenses of repair of such parts in case of an accident.
Why 5 Crore+ Policyholders Choose Us?
IndusInd Motor Insurance (formerly Reliance Motor Insurance) offers tailored motor insurance plans to minimise your out-of-pocket expenses during unexpected emergencies. To provide maximum protection, our plans are bundled with:
Up to 5 years Coverage*
Long and short term plans
Up to 90% Discount*
Save more with our online plans
13+ Add-On Covers*
Customise and enhance coverage
AI-Assisted Claims*
Quick claims via our Self-i app
Depreciation Rates in Car Insurance
As per the IRDAI, these are depreciation rates for various parts of the vehicle:
| % of Depreciation |
|---|---|
For all rubber/plastic parts/nylon, tubes and tyres, airbags and batteries | 50% |
For fibreglass component | 30% |
For all parts made of glass | Nil |
For Paint Jobs | 50% (applicable only on the material cost of total painting charges) |
Rate of depreciation for all other parts, including wooden parts:
| % of Depreciation |
|---|---|
Less than 6 months | Nil |
More than 6 months but less than 1 year | 5% |
More than 1 year but less than 2 years | 10% |
More than 2 years but less than 3 years | 15% |
More than 3 years but less than 4 years | 25% |
More than 4 years but less than 5 years | 35% |
More than 5 years but less than 10 years | 40% |
More than 10 years | 50% |
How is Depreciation Calculated in Car Insurance?
According to the Insurance Regulatory and Development Authority of India (IRDAI), the rate of depreciation in car insurance is calculated:
Age of Vehicle
| % of Depreciation for Determining IDV |
|---|---|
Less than 6 months | 5% |
More than 6 months but less than 1 year | 15% |
More than 1 year but less than 2 years | 20% |
More than 2 years but less than 3 years | 30% |
More than 3 years but less than 4 years | 40% |
More than 4 years but less than 5 years | 50% |
More than 5 years but less than 6 years | 55% |
More than 6 years | Decided mutually by the insured and the insurer |
Role of Zero Depreciation in Car Insurance During Claim Settlement
During claim settlement, zero dep insurance plays a crucial role by ensuring that you receive almost 100% of the claim amount for the repair in case of accidental damage. Let us consider the following example to understand the role of zero depreciation add-on in car insurance. Let us assume that your 2-year-old car incurs damage due to a collision and requires the replacement of some parts of your vehicle. The estimate received from the garage is ₹50,000.
If you have our comprehensive car insurance but without the zero depreciation add-on cover, this is the depreciation rate applied:
Description | Repair Cost | Depreciation Rate | Deductions |
|---|---|---|---|
Replacement of Plastic Parts | ₹10,000 | 50% | ₹5,000 |
Repair of Metal Parts | ₹40,000 | 20% | ₹8,000 |
Benefits of Zero Depreciation Car Insurance
Full Claim Settlement
Our nil depreciation cover ensures that you receive almost 100% of the claim amount without the deductions for depreciation. This means that you receive the total cost of the repair or replacement, providing better coverage and cost-efficiency.
Ideal for New and Luxury Cars
Our add-on feature is particularly beneficial for those who own a new, expensive or luxury car. Since the cost of replacement or repair of such cars is higher, with zero depreciation cover, you can be assured that the costs are fully covered.
Minimises Out-of Pocket Expenses
With our nil depreciation car insurance, you can significantly reduce the amount you pay to cover the difference between the repair costs and the claim amount. As you do not have to bear the depreciation costs, you receive adequate coverage and make the best out of your car insurance.
Enhanced Resale Value
Your car insurance and the add-ons maintained can testify to your car’s ideal maintenance and good condition. Knowing that your car is well protected can, therefore, enhance its resale value.
Peace of Mind
With our add-on cover, you can be assured of complete peace of mind. Knowing that IndusInd General Insurance offers the best financial protection in case of any mishap or accident, you can enjoy any ride with peace of mind.
Zero Depreciation in Car Insurance: Inclusions & Exclusions
What's Covered?
Damages Caused by Natural or Man-Made Calamities: Since this is an add-on cover, the inclusions of your base policy are applied. Thus, damages caused by natural or man-made calamities, such as floods, earthquakes, inundation, vandalism, etc., will be covered under the zero depreciation cover as well.
Damages Caused by Road Accidents: Our nil depreciation add-on covers damages incurred in collisions or accidents. It also covers damages caused to car parts, such as fibreglass, plastic or metallic parts.
Damages Caused During Transit: If your car incurs damage during transit of your car from one location to another, the expenses for the same will be covered under this add-on cover.
What's Not Covered?
Vehicle Not Being Used in Accordance to its Intended Use: If your car is not being used for its intended purpose, for example, a private car being used as a commercial vehicle, then your claim will be invalid.
Driving Under the Influence: If you are found to be driving under the influence of alcohol or any other substance during the incident, then the claim will be rejected.
Invalid Vehicle-Related Documents: If you are driving without a valid driving licence, PUC or registration certificate at the time of the incident, your claim is void.
Mechanical Breakdown: Our nil depreciation cover does not cover the repair of damages caused by mechanical breakdowns.
Expired Policy: Claims raised against an expired car insurance policy will be rejected. Thus, ensure that you renew your policy on time to benefit from the policy’s coverage.
Delayed Claim: You must inform us about the accident within 24 hours and initiate the claim online or by calling our helpline number (+91 22 48903009) as soon as possible. Failure to do so will result in rejection of the claim; unless there was a valid reason for the delay.
Damages to Excluded Car Parts: We do not cover the cost of repairing or replacing certain damaged car parts, including the engine, battery, tyre, glass and accessories.
Who Should Opt for Zero Depreciation Car Insurance?
Zero depreciation car insurance is ideal for a specific group of car owners who seek comprehensive coverage and overall financial protection. Buying our nil depreciation car insurance can prove to be beneficial to:
Zero Depreciation Insurance vs Comprehensive Insurance Coverage
Parameters | Zero Depreciation Insurance | Comprehensive Insurance |
|---|---|---|
Coverage | Covers full repair/replacement costs without depreciation deductions. | Covers damages, but depreciation is deducted from claim amounts. |
Claim Settlement | Depreciation does not affect the claim settlement, and full compensation is given to the insured. | The claim amount is received after a standard deduction of depreciation. |
Premiums | The premiums are higher as this is an add-on feature that provides enhanced coverage. | Lower premiums when bought without any add-ons. |
Claim Settlement Frequency | With our add-on, you can claim your insurance twice in a policy year. | Does not limit the maximum number of claims. However, the claim amount should be within the sum insured. |
Financial Security | The repairing costs of fibre, glass, rubber, and plastic parts are borne by the insurer without any depreciation deduction. | Provides broad coverage but considers deductions for depreciation, which must be borne by the insured. |
How Much Does a Zero Depreciation Car Insurance Policy Cost?
Age of the Car
Since the age of your car also increases the depreciated value of certain parts, it is a major factor governing the insurance policy cost. Thus, the older the car, the higher the premium.
Model of the Car
The type of car is also one of the most important factors in determining the cost of car insurance. If you own a luxury car, the insurance cost will be higher as the repair or replacement costs of damaged parts will be higher than for a hatchback or SUV. Thus, the make and model of your car are considered while determining the cost.
Your Location
Your car insurance costs change with different geographical locations. For instance, if you live in a disaster-prone or humid area, the chances of catching rust or damage to parts of your vehicle are high. In such cases, the insurance cost will be higher than usual.
Factors to Consider Before Opting for Zero Depreciation Cover
Consider the Age of Your Car
Our car insurance nil depreciation cover is applicable to cars under the age limit of 3 years. So, in other words, only new cars are eligible for 0 depreciation car insurance.
Insurance Cost
As compared to a regular car insurance policy, zero depreciation car insurance will be slightly more expensive in terms of premium. While the slight increase in the premium offers significant benefits when making an insurance claim, it is still important to consider the increase before buying the add-on.
Annual Claim Limit
Under our nil depreciation cover, you can make only two claims in a policy year. This is to prevent customers from making claims about every small dent in their car. Thus, ensure that this fits your coverage requirements and that you are aware of the limit set before opting for it.
Terms and Conditions
We clearly state the terms and conditions applicable to the insurance policy. It is important to be thorough, as violations of these terms can result in claim rejections.
How to Buy/Renew Zero Depreciation Car Insurance
Steps to Buy Zero Dep:
- Go to IndusInd General Insurance’s website and go to the Car insurance page from the main menu tab.
- Next, you need to add your details, such as your registration number, mobile number and email ID.
- Enter the make and model of your vehicle and select the type of plan.
- Next, click on “Buy Now” then you will receive a quote based on your input.
- Verify the quote and select the add-on “nil depreciation” or “zero depreciation.” Confirm & Pay!
Steps to Renew Zero Dep:
Go to IndusInd General Insurance’s official website.
Go to the “Renewal” tab from the main menu and click “Renew Car Insurance”.
Enter your existing policy details and vehicle details.
Opt for the add-on “nil depreciation” or “zero depreciation.”
Verify the details and complete the payment using your preferred mode.
Key Takeaways
The advantages of zero depreciation car insurance make it a valuable addition to your policy coverage. It provides enhanced financial protection by reducing the liability of bearing the extra cost due to depreciation deductions.
With IndusInd General Insurance, you can swiftly buy or renew comprehensive car insurance or standalone own-damage insurance with the nil depreciation cover and benefit from the enhanced coverage.
Relevant Links for Car Insurance
Car Insurance for Top Car Brands
Disclaimer:
T&C apply. The information mentioned on this page is only an indication of the coverages/benefits offered by Nil Depreciation for Private Car UIN No. IRDAN103RP0010V02100001/A0003V01200910; Nil Depreciation for Private Car- Bundled, UIN: IRDAN103RP0007V01201819/A0030V01201819; Nil Depreciation for Private Car for Motor Secure Plus and Motor Secure Premium- Own Damage, UIN: IRDAN103RP0001V01201920/A0013V01201920. Please read the policy wordings, brochure, and prospectus before concluding a sale.
Download our Self-i App now!
Support test
Edit Policy Details
Download Policy
Check Policy Status
My Service Requests
My Bookmarks
Buy
+91 123456789
Help
+91 123456789
Agent
+91 123456789
support@reliancegeneral.co.in
WhatsApp Us
Customers can contact us between 10:00AM to 06:00 PM
Become an Agent
Wish to become an agent with Reliance?