Zero Depreciation Car Insurance

Car insurance is a must-have, but traditional policies consider depreciation, which reduces the claim amount. Enter Zero Depreciation Car Insurance — an add-on that ensures you get the full value of repairs and replacements without factoring in depreciation.

Know About the Zero‐Depreciation Cover in Cars

A zero‐depreciation cover offers comprehensive coverage without factoring in for depreciation.

Depreciation refers to the gradual decline in value of an asset over time due to a combination of factors such as age, wear, tear and obsolescence. All vehicles are depreciating assets and at the time of insurance claim, every insurance company calculates and applies the depreciation rate to decide the total amount payable.

●      Claim settlement ‐ Under this policy, depreciation does not affect the claim settlement and full compensation is provided to the insured.

●      Only new cars are included ‐ Cars less than 3 years old are only included and only new car owners can purchase it.

●      Has some notable exclusions ‐ A zero‐depreciation cover does not cover  normal wear, tear and mechanical breakdowns. Every policyholder is bound to pay ay a mandatory policy excess.

●      Claim limitation ‐ A zero‐depreciation add‐on cover has some claim  imitations annually, though this might vary from one company to another.

●      Repairing costs ‐ Any damage to fibre, glass, rubber and plastic parts are borne by the insurer.

●      Higher premium ‐ Zero‐depreciation covers generally have higher  remiumspremiums in comparison to a normal car insurance cover.

Advantages of Zero Depreciation cover

●        Policyholders need not pay out‐of‐pocket expenses since the current cost is not taken into account.

●        This type of insurance reduces worries a complete write‐off of a new car.

●        Almost all the vital parts of the car are covered without taking into account the depreciation factor.

Ideal Situations for Purchasing a Zero‐depreciation Cover

●        People having luxury cars

●        People with new rare cars

●        People residing in accident‐prone zones

●        Cars having expensive spare parts.

●        Roads filled with bumps and dents

It is believed that this policy is appropriate for new or inexperienced drivers as they are likelier to get the car damaged. However, this cannot be regarded as always true, since in numerous cases, experienced drivers have also suffered accidents.

●      Full Coverage for Repairs: Get complete claim settlement without any deduction for depreciation on parts like plastic, rubber, and fibre.

●      No Value Loss for Parts: Even if your car parts wear out over time, you’ll receive the full cost of replacements.

●      Ideal for New & Luxury Cars: Perfect for cars less than 5 years old or high-end models where parts are expensive.

●      Saves Money in the Long Run: Slightly higher premium, but much more savings during claims.

●      Multiple Claims Allowed: Depending on the insurer’s terms, you may make more than one claim per policy term.

●      Peace of Mind: Avoid unexpected out-of-pocket expenses during repairs.

●      Available Across India: Widely offered by top insurers, including Bajaj General Insurance.

●      7,200+ Cashless Garages: With Bajaj General Insurance, enjoy access to an extensive nationwide repair network.

●      Improves Claim Experience: Faster, smoother, and more satisfying claims.

●      Added Protection for New Cars: Maintain resale value by using only genuine, fully paid replacements.

Depreciation Rates in Car Insurance (Simplified)

Depreciation reduces your claim payout. As your car ages, the insurer deducts a percentage of part costs. A zero depreciation insurance add-on eliminates this deduction and covers the full cost.

Rate of Depreciation for All Parts Approved by IRDAI

Rate of Depreciation in Vehicles

Rate of Depreciation in Metallic Parts

Zero depreciation car insurance means no deductions for these parts, making it an essential choice for most car owners.

Insurer-Wise Number of Zero Depreciation Claims (Industry Snapshot)

●      Bajaj General Insurance stands out with one of the highest volumes of successfully processed zero-depreciation claims, supported by a network of over 7,200 cashless garages across India.

●      Other insurers may offer zero-dep add-ons, but many limit the number of claims per year or require higher premiums for extended coverage.

●      While some providers focus more on urban regions with selective garage access, Bajaj General Insurance ensures pan-India reach and faster service even in tier 2 and tier 3 cities, including a more streamlined and digitally enabled claims journey