What is Zero Depreciation car Insurance?
Depreciation means a reduction in the value of an asset over a period of time. So when we say zero depreciation in car insurance, it means it protects your car from all the damages without factoring in any depreciation while calculating your insurance claims.
This can be added to your existing insurance as an add-on. There are several benefits to this add-on.
Benefits of Zero Depreciation Car Insurance:
- Higher Claim Settlements: You don’t need to worry about your claims getting settled as this offers higher settlement rates without any depreciation deducted.
2. Your car will always be treated as good as new: When you have got these as an add-on, the insurance company will offer you 100% of the entire cost (minus the deductibles) of the body part which has to be replaced, in case if your car gets in an accident.
3. Your car will always be valuable: Zero depreciation car insurance can keep your car valuable just like it was when you first bought them. The value of your car is always the same and even while you’re selling it, it will have a great resale value as long as the add-on is still active.
When should you opt for the zero-dep car Insurance?
It’s not mandatory to have this add-on, but there are certain times when you might find this helpful.
- #1 Reason: When you have a luxury car, the zero dep car insurance might be helpful because the car parts are costlier than a normal car.
- #2: When you are new to driving and if your place is an accident-prone area, you can get this add-on to avoid expenses.
- #3: If you just want to reduce out-of-pocket expenses you might want to get this insurance to get the full claim settlement for your damages.
Inclusions under Zero Dep Car Insurance Add-on:
This zero depreciation add-on provides covers against loss of value due to depreciation on the following car components:
- All metal parts
- All fiber parts
- All rubber parts
Zero depreciation add-on cover is only applicable for cars between the ages of 0-5 years.
Exclusions under Zero Dep Car Insurance Add-on:
This add-on will not cover the following damages:
- Engine damage caused due to oil leakage or water ingression.
- Cost of replacing consumables.
- Mechanical breakdown of the car.
Zero Depreciation Add-on Cover Vs Comprehensive Car Insurance
|Zero Dep Add-on Cover||Comprehensive Car Insurance|
|This is just an add-on cover and not a whole insurance policy||This is a whole insurance policy|
|Has higher premiums since you are using the add-on||Lower premiums without the add-on|
|Can use only a limited number of claims under this add-on||Any number of claims can be done under this policy|
|With this add-on, the depreciation rates are considered as nil||With age, the depreciation of your car keeps increasing (in percentage) and this will not be covered in the claim.|
Chola Ms offers a Zero-depreciation add-on to your existing policy. Contact us or visit our website to know more about what we offer or follow the simple steps mentioned and book your insurance online.