Your two-wheeler or four-wheeler vehicle’s value depreciates every year, which means that the actual value of your vehicle decreases with its age. If you own a vehicle, then you must know what normal wears and tears to a vehicle mean. Purchasing a new vehicle is not so easy these days due to their rising prices. In the case of a road accident or any other mishap, the cost of repairing the damages can also prove to be very expensive. A complete two-wheeler insurance policy can provide you complete coverage against expensive bills.
Most of the two-wheeler insurance companies offer add-on covers with third-party covers in their packages. Now, insurance companies have come up with the concept of Zero Depreciation Cover for two-wheelers, which will provide coverage against depreciation.
Benefits from a Zero Depreciation Cover
For instance, Mr. Gupta met with an accident and he appropriately filed an insurance claim. He was shocked when he got to know that he would get 30% lesser amount than expected one. He was expecting a compensation of Rs. 1 Lakh. He later got to know that the amount he got after the deduction of depreciation value because he purchased a standard two-wheeler insurance policy. If Mr. Gupta had purchased an insurance policy with zero depreciation cover, then he would have received the full amount, i.e. without any deductions.
Understanding a Zero Depreciation Cover
Depreciation means the timely deduction in the actual value of your vehicle. For example, if you buy a new car, then it costs you more than what a used car does. Depreciation factor is considered by all insurance companies at the time of delivering the compensation. Hence, without Zero Depreciation Cover, a standard insurance policy provides you compensation after mandatory deductions.
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Zero-Depreciation Cover Inclusions
Zero Depreciation Cover provided by insurance companies provides you coverage for damages to rubber, plastic, fiberglass, and nylon parts only. Zero Depreciation Cover can be opted for brand new vehicles, which you can also avail at the time of renewal of the policy. This Zero Depreciation Cover is meant for two wheelers with a maximum age of 2 years only. The validity of Zero Depreciation Cover is for up to two claims only.
Zero-Depreciation Policy Exclusions
The following points are not included in zero depreciation policies:
- Damages due to an uninsured risk
- Damage to items that are uninsured like tyres, bi-fuel kit and gas kits
- General wears and tears.
- Damages due to a mechanical fault
The period of most of zero depreciation insurance policies available in the market is one year but you can enjoy the benefits by renewing it annually. In case you don’t have zero depreciation coverage, you can purchase it at the time of purchasing a two wheeler insurance policy or at the time of renewal of your policy.
Conditions for availing the Zero-Depreciation Cover
You should read the policy wording and understand terms and conditions regarding the cover. Paying attention to these conditions will clear all your doubts regarding zero depreciation cover. In most of the cases, the following conditions come with the zero depreciation cover:
- Zero depreciation cover is not applicable if your insured vehicle is completely damaged or you lose it
- Zero depreciation covers only two times during our policy term
- The insured two-wheeler should be repaired at a network garage only to avail zero depreciation cover.
The above conditions can be varied depending on the insurer. Enquiring your insurer will help you to know more about the terms and conditions.
Perks of Zero-Depreciation Insurance Plan
If you add zero depreciation cover to your policy, then you will get the following primary benefits -
- You will not have to pay for repairing the damages from your pocket if you add zero depreciation cover to your policy as no cost of depreciation is charged.
- Depreciation will not be considered if you have a zero depreciation cover while making a claim.
If you add Zero Depreciation cover to your two-wheeler insurance policy, then you don’t have to take tension, as your pocket remains heavy. Major insurance providers are offering this add-on cover included with your insurance policy, which helps you avoid hassles by paying a slightly extra premium.
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