Zero Depreciation vs Consumables Cover: Know the Key Differences
Add-ons in car insurance are additional covers that enhance the policy coverage and provide extra protection to vehicle owners.
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What is Zero Depreciation Cover?
A car depreciation means the value of the car and its parts reduces because of its age, wear & tear, as well as market conditions. In a standard comprehensive car insurance plan, insurers consider the depreciation costs of the insured vehicle and deduct it while settling a claim. As a result, you don't get the complete claim amount and end up paying from your pocket.
The zero depreciation cover in car insurance (also known as bumper-to-bumper cover) ensures that the insurer will pay the full cost of replacing damaged car parts without deducting the vehicle depreciation. This ensures maximum reimbursement during repairs.
Let's know the depreciation percentage of cars and their different components.
Car Depreciation Rates by IRDAI (2025)
Every year, the IRDAI (Insurance Regulatory and Development Authority of India) sets the vehicle deprecation rates in India. Have a look at the depreciation rates of a car and its different components:
| Age of the Vehicle |
Depreciation Percentage |
| Below 6 months |
5% |
| 6 months - 1 year |
15% |
| 1 year - 2 years |
20% |
| 2 years - 3 years |
30% |
| 3 years - 4 years |
40% |
| 4 years - 5 years |
50% |
*Note: For cars above 5 years, the depreciation percentage is decided mutually between the insurer and car owner.
Here are the depreciation percentages for different car parts:
| Car Components |
Depreciation Rate |
| Rubber/Nylon/Plastic Parts, Tyres & Tubes, Batteries, Airbags, Paintwork |
50% |
| Fibre Glass Parts |
30% |
| Glass Parts |
Nil |
Now, for example;
In an unfortunate accident, your car's bumper gets damaged and requires replacement.
If you have a zero depreciation add-on in your car insurance policy, the insurer will cover the entire replacement cost. However, if you have a regular car policy, you would bear the depreciation percentage of your insured car's bumper as per the percentages mentioned above. Have a look at the calculation below:
Cost of Bumper Replacement: Rs. 12,000 (approx.)
Your out-of-pocket expenses will be as follows:
- With a Standard Car Policy: Rs. 6,000 (considering the 50% depreciation)
- With the zero depreciation car insurance policy: Rs. 0
What is Consumables Cover?
Consumables are parts that cannot be reused and are consumed during servicing or replacement. These include:
- Engine oil
- Brake oil
- Screws, Nuts, and bolts
- Lubricants
- Coolants
- Washers, grease, etc.
A standard four-wheeler policy does not cover the cost of these consumables. But, with the consumables cover, the insurer bears the cost of these items in case of a claim. This add-on takes care of small but essential items used in car repairs. Although the cost of each consumable may be small, collectively they can make up a significant expense.
Why is Zero Depreciation Cover Important?
Zero depreciation cover benefits car owners in several ways. These are:
- Higher Claim Payout: Full compensation without deductions for depreciation.
- Peace of Mind: Zero worry of bearing extra costs for part replacement.
- Covers Plastic & Fiber Parts: Since these parts depreciate quickly, zero dep car insurance covers their complete replacement cost.
Why is Consumables Cover Important?
Here are the benefits you get when you opt for the consumables cover add-on with your car insurance:
- Covers Hidden Costs: Nuts, bolts, engine oil, and lubricants can cost thousands during a big repair.
- Better Financial Protection: Even the smallest expenses are reimbursed.
- Ideal for Accident-Prone Areas: If you live in a city with heavy traffic or rough roads, this add-on prevents minor costs from piling up.
- Complements Zero Depreciation: When chosen together, both add-on covers ensure almost complete protection.
Zero Depreciation and Consumables Cover in Car Insurance
Both these add-ons in car insurance provide additional protection to vehicle owners; they differ in terms of the coverage offered. Here's how zero depreciation cover differs from the consumables cover in a four-wheeler insurance policy:
| Feature |
Zero Depreciation Cover |
Consumables Cover |
| Coverage |
Complete cost of parts without considering their depreciation |
Cost of consumable items, such as oils, screws, nuts, bolts, lubricants, etc. |
| Benefit |
Major accidents or part replacements |
Regular or accidental repairs that involve consumables |
| Inclusion |
Covers metal, plastic, fiber parts |
Covers items usually excluded by insurers |
| Ideal For |
New or luxury cars, because of expensive spare parts |
Cars frequently repaired or driven in tough conditions |
| Claim Payout |
Increases the total claim payout amount |
Reduces small but frequent out-of-pocket expenses |
In simple terms, zero depreciation cover saves you from losing money on depreciation deductions, while consumables cover saves you from repair expenses of consumable items.
Who Should Opt for Zero Depreciation and Consumables Covers?
One should opt for zero depreciation and the consumables covers with the comprehensive car insurance under these scenarios:
- New Car Buyers: Zero depreciation cover is particularly beneficial for new car buyers. This is because a new car's depreciation is the highest in the first 5 years.
- Daily City Commuters: Both the zero depreciation and consumables covers can highly benefit daily commuters because of the traffic. The higher the traffic, the more the chances of an accident.
- Luxury Car Owners: If you have a high-end or luxury car with expensive spare parts, the zero depreciation cover is a must for you. On the other hand, if you also choose the consumables cover, you get an extra layer of financial protection.
- Old Cars: Zero dep is usually available only for cars up to 5-7 years old (some insurers may offer for up to 10 years old cars. However, you can opt for the consumables cover if you have a car older than 7 years.
If it suits your budget, you should opt for both add-on covers with your car insurance policy to make sure you have maximum protection, with little to zero repair cost in case of a claim.
Exclusions of Zero Depreciation and Consumables Cover
Like every add-on in car insurance, both come with certain exclusions:
Zero Depreciation Add-on Does not Cover:
- Mechanical breakdowns or wear and tear
- Cars older than the insurer's eligibility (generally 5-7 years, some may even provide for a 10-year old car)
- Tyre damage (unless in an accident)
- Damage due to uninsured perils like drunk driving
Consumables Cover Excludes:
- Damages not related to an accident
- Regular maintenance items (like routine oil changes)
- Loss outside policy terms, e.g., illegal driving
It is important for you to understand these exclusions before you choose the car insurance coverage with these add-ons. It will help you avoid any surprises during claim settlement.
Cost of Zero Depreciation vs Consumables Covers in Car Insurance
Here is the additional premium you need to pay for your car insurance coverage when you opt for zero depreciation and consumables covers:
- Zero Depreciation Add-on: 15-20% more than the standard policy.
- Consumables Cover: A nominal increase by 5-10%.
Zero depreciation is slightly costlier than a regular policy, but it offers a higher claim amount payout. While the consumables cover is inexpensive, it provides meaningful protection in case of a claim.
Over to you,
Both zero depreciation cover and the consumables cover in a car insurance policy help reduce your repair expenses, but they serve different purposes.
- Zero Depreciation ensures you don't lose money on depreciation deductions.
- Consumables Cover ensures that even the smallest expenses of consumable items will get reimbursed.
If you have a new car or you drive frequently, it is a great idea to opt for both add-on covers. It will ensure that you have near-complete financial protection in the event of an unfortunate accident.
