Unlock Maximum Savings with Zero Depreciation Car Insurance: Your Ultimate Guide

If you’re a car owner, you know the drill – accidents happen, and car repairs can put a significant dent in your wallet. But what if we told you there’s a way to minimize those out-of-pocket expenses and protect your hard-earned money? Introducing zero depreciation car insurance, your secret weapon against the dreaded depreciation costs that come with car insurance claims.

What is Zero Depreciation Car Insurance?

Zero depreciation car insurance, also known as nil depreciation cover, is an add-on to your comprehensive car insurance policy that ensures you don’t have to bear the cost of depreciation when making a claim. In simpler terms, it means that when you file a claim for repairs or replacement of any damaged parts, the insurance company will pay the full cost without deducting the depreciated value of those parts.

Without this add-on, the insurer would typically pay only the depreciated value of the damaged parts, leaving you to cover the remaining cost out of your own pocket. But with zero depreciation car insurance, you can rest assured that you’ll receive the maximum possible claim amount, saving you from those pesky out-of-pocket expenses.

How Does Zero Depreciation Car Insurance Work?

To understand how zero depreciation car insurance works, let’s look at an example:

Imagine you met with a minor accident, and your car’s bumper needs to be replaced. The cost of a new bumper is ₹10,000.

  • Without Zero Depreciation Cover: Assuming a depreciation rate of 50% for plastic parts, the insurer would pay only ₹5,000 (₹10,000 – ₹5,000 [depreciation]), and you would have to bear the remaining ₹5,000 from your own pocket.

  • With Zero Depreciation Cover: The insurer would pay the full ₹10,000 for the new bumper, and you wouldn’t have to pay anything out of your pocket (apart from the standard deductible, which is applicable in both cases).

As you can see, zero depreciation car insurance can save you a significant amount of money, especially if you need to replace multiple parts or have an older vehicle with higher depreciation rates.

Benefits of Zero Depreciation Car Insurance

Zero depreciation car insurance offers several benefits that make it an attractive add-on for car owners:

  1. Higher Claim Payouts: With zero depreciation cover, you’ll receive the full cost of repairs or replacements, without any deductions for depreciation.

  2. Better Savings: By avoiding out-of-pocket expenses for depreciation, you can save a considerable amount of money in the long run.

  3. Affordable Add-on: Contrary to popular belief, zero depreciation cover is relatively affordable, especially when you consider the potential savings it offers.

  4. Greater Peace of Mind: With the assurance that you won’t have to bear the cost of depreciation, you can drive worry-free, knowing that your car is fully protected in case of an accident.

When Does Zero Depreciation Car Insurance Come Into Play?

Zero depreciation car insurance covers a wide range of scenarios, including:

  • Accidental Damage: If your car is damaged in an accident, zero depreciation cover ensures that you receive the full cost of repairs or replacements.

  • Natural and Man-made Disasters: If your car is damaged due to natural calamities like floods, earthquakes, or man-made disasters like riots or terrorist attacks, zero depreciation cover has got you covered.

  • Damage During Transit: If your car is damaged while being transported from one location to another, zero depreciation cover will help cover the costs.

However, it’s important to note that zero depreciation cover does not apply in certain scenarios, such as:

  • Driving without a valid license
  • Driving under the influence of alcohol or drugs
  • Normal wear and tear or mechanical breakdown
  • Issues with engine oil, coolant, or clutch oil
  • Total loss of the car
  • Repair costs exceeding the insured value of the car
  • Claiming more than twice in a policy year under this add-on

How to Get Zero Depreciation Car Insurance Online

Getting zero depreciation car insurance online is a straightforward process:

  1. Get a Quote: Visit the insurance provider’s website and provide your vehicle registration details and contact information to get a quote.

  2. Choose Your Plan: Select the comprehensive car insurance plan that suits your needs and add the zero depreciation cover to it.

  3. Make the Payment: Once you’ve chosen your plan, make the payment online using the secure payment gateway.

  4. Receive Your Policy: After successful payment, you’ll receive your car insurance policy with the zero depreciation add-on instantly.

Factors Affecting Zero Depreciation Car Insurance Premium

While zero depreciation car insurance is generally affordable, the premium can vary depending on several factors:

  • Car’s Age: The older your car, the higher the zero depreciation premium, as older cars typically have higher depreciation rates.

  • Car’s Model: Different car models use different types of parts, which can affect the cost of replacements and, consequently, the zero depreciation premium.

  • Location: If you live in an area prone to accidents or natural calamities, the zero depreciation premium may be higher.

  • Insured Declared Value (IDV): The IDV, which is the car’s current market value, plays a crucial role in determining the zero depreciation premium.

  • Engine Type and Fuel Type: Cars with higher engine capacity or alternative fuel types (e.g., CNG, electric) may attract higher zero depreciation premiums.

  • Accessories Installed: If you’ve installed additional accessories in your car, the zero depreciation premium for those accessories will be calculated separately.

Is Zero Depreciation Car Insurance Worth It?

The decision to opt for zero depreciation car insurance ultimately comes down to your individual circumstances and preferences. However, here are a few scenarios where zero depreciation cover can be particularly beneficial:

  • New Drivers: If you’re a new driver or tend to be a bit more cautious on the road, zero depreciation cover can provide added peace of mind and protection against potential accidents.

  • Frequent Long Drives: If you frequently take your car on long drives or road trips, zero depreciation cover can be a wise investment, as the risk of accidents or incidents increases with more time spent on the road.

  • Living in Accident-Prone or Natural Disaster-Prone Areas: If you reside in an area with a high risk of accidents or natural calamities, zero depreciation cover can help mitigate the financial impact of any potential damages.

Remember, while zero depreciation car insurance may slightly increase your overall premium, the potential savings it offers in case of a claim can far outweigh the additional cost.


Zero depreciation car insurance is a valuable add-on that can save you from the financial burden of depreciation costs when making a claim. By ensuring that you receive the full cost of repairs or replacements, this coverage can provide significant savings and peace of mind, especially for new drivers, frequent travelers, or those living in high-risk areas.

While the premium for zero depreciation car insurance may vary based on factors like your car’s age, model, and location, the potential benefits often make it a worthwhile investment. So, the next time you renew or purchase your car insurance, consider adding zero depreciation cover to your policy and unlock maximum savings while keeping your car fully protected.

Comprehensive Car Insurance OR Zero Depreciation Cover. What Should You Choose?


What is the benefit of zero depreciation car insurance?

A zero dep is an add-on cover under which the insurance company does not charge the depreciation sustained by the insured car. Under a nil depreciation add-on in car insurance, a policyholder can claim the total cost of replacement of car parts in case of accidental damage.

What is difference between zero depreciation and comprehensive insurance?

The key difference between zero depreciation and comprehensive insurance for a bike is that zero depreciation insurance provides coverage for damages to the vehicle without any deduction of depreciation while comprehensive insurance covers damages to your vehicle caused by accidents, theft, natural calamities, after …

Is bumper to bumper same as zero depreciation?

The Zero Depreciation Car Insurance policy also often referred to as bumper to bumper car insurance. Whereas a basic or third party policy covers damage to the third party or their vehicle in case of an accident, bumper to bumper insurance offers coverage to your vehicle as well.

What is depreciation in car insurance?

Depreciation is defined as the decrease in the value of the vehicle with time due to age, and wear and tear. As your car ages, its market value goes down, and so does the claim amount that you get.

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