IDV Calculator

IDV Calculator FAQs

• Q1. What is the full form of IDV?

  Ans: The IDV full form is Insured Declared Value. It is the vehicle's current market value. The IDV of a car is the highest amount an insurance company compensates to the policyholder in the event of total loss or theft.

• Q2. How to calculate IDV for car insurance?

  Ans: You can calculate IDV in car insurance using the following formula:

  IDV= (Selling price of the car - car's depreciation value) + (Any purchased accessories - depreciation of accessories).

  You can also determine the IDV by using IDV value calculator for car on Policybazaar.com.

• Q3. How insurance companies calculate car value?

  Ans: Insurance companies calculate a car's value using its ACV (Actual Car Value), which is its replacement cost minus depreciation over time. The ACV of a car is based on its IDV, which is determined using the car's manufacturer's selling price, age, make & model, and kilometers driven.

• Q4. How much does IDV decrease every year?

  Ans: The Insured Declared Value (IDV) decreases every year due to the depreciation of the vehicle & its parts. The rate of IDV decrease is 5% for the first 6 months, then 15 % for the first year, and 20%, 30%, 40%, & 50% for the second, third, fourth, and fifth years, respectively.

• Q5. What is the depreciation on cars?

  Ans: A car's depreciation is based on its make & model, age, registration location, etc. Rates for depreciation are fixed by the Insurance Regulatory and Development Authority of India (IRDAI) and are as follows:

  • Less than 6 months: 5%
  • 6 months to 1 year: 15%
  • 1 to 2 years: 20%
  • 2 to 3 years: 30%
  • 3 to 4 years: 40%
  • 4 to 5 years: 50%

• Q6. When can I claim the IDV of my car?

  Ans: You can claim the IDV of your car when your car is damaged beyond 75% of its current market value (constructive total loss) or is stolen.

• Q7. What should be the ideal IDV?

  Ans: Your car's IDV should be close to its actual market value. For a new car, the IDV is close to its selling price (5% depreciation is applied), and as the car ages, this value decreases. Ideally, a car's IDV should be sufficient to cover the total loss or damage in the event of an accident.

• Q8. Can I choose my own IDV?

  Ans: When you buy or renew car insurance, you can increase or decrease your car's IDV by 15% from the value set by your car insurance company.

• Q9. What is the IDV payout?

  Ans: The Insured Declared Value (IDV) payout is the maximum amount that the car insurance company pays to the policyholder in the event of total loss or theft of the insured vehicle.

• Q10. How much IDV after 2 years?

  Ans: For a car aged between 1-2 years, its IDV value will be as per 20% depreciation from the ex-showroom amount of the vehicle. If your car's age is more than 2 years but less than 3 years, its depreciation for IDV will be 30%.

• Q11. Is higher IDV better?

  Ans: A higher IDV value of a vehicle means higher insurance premium. Hence, you must weigh the benefits against the premium amount and choose an IDV that best matched your four-wheeler's current market value.

• Q12. How much IDV can be claimed?

  Ans: If your car insurance claim amount exceeds 75% of the IDV, the insurer will consider it a total loss and pay you the full Insured Declared Value.

• Q13. If I have a brand new car, what should be the IDV?

  Ans: The IDV for your brand new car must be generally 95% of the ex-showroom price, after considering a standard depreciation of 5%. For example. If your car is ₹20 lakhs, after depreciation, your IDV will be ₹19 lakhs.

• Q14. Are NCB and IDV the same?

  Ans: No, NCB and IDV are two different terms used in car insurance. An Insured Declared Value (IDV) is the maximum compensation that you will receive in case of total loss or theft of the insured car. On the other hand, an NCB is a discount and reward granted to the policyholder for every claim-free year. This reward can be used to get a discount on car insurance renewal premiums.