Is There A Difference Between Comprehensive Car Insurance And Zero Depreciation Insurance?

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According to the Motor Vehicles Act of 1988, car insurance is required. However, the Act only requires a third-party policy that safeguards third parties’ interests in case of an emergency. It would help if you chose a comprehensive policy to ensure coverage for the harm done to your vehicle. Additionally, you can choose a zero depreciation cover to broaden the scope of coverage of a comprehensive policy.

Car-Insurance

Let’s examine their comparative analysis and the concepts of comprehensive vs. zero depreciation coverage options.

What Exactly Is Comprehensive Car Insurance?

A comprehensive Bajaj Allianz car insurance plan covers third-party liabilities and vehicle damage. After the initial year, you can renew the policy for as long as you own a car. Claims are subject to terms and conditions set forth under the motor insurance policy.

What Is A Zero Depreciation Car Insurance Policy?

A comprehensive car insurance poslicy does not cover the depreciation of a car caused by typical wear and tear. As a result, when a claim is made, the appropriate depreciation is subtracted from the claim sum, leaving you responsible for covering the depreciation expense out of pocket. You may be protected against such out-of-pocket costs by a zero depreciation policy. The zero depreciation addition is part of a Bajaj Allianz comprehensive car insurance plan. The insurance policy covers third-party liabilities, vehicle damage, and component depreciation. The insurance provider does not deduct any depreciation from the repaired or replaced parts in case a car insurance claim process is initiated. It covers all incurred repair expenses in full. Claims are subject to terms and conditions set forth under the motor insurance policy. *

Depreciation Rates That Apply To Comprehensive Plans Versus Zero Depreciation Plans

Here are the depreciation rates that would be used on the components of your car under a comprehensive policy as opposed to a zero depreciation policy:

Parts Of The Car Only Comprehensive Policy Zero Depreciation Policy
Rubber, Nylon, or plastic car parts 50% depreciation Nil depreciation
Fibreglass car parts 30% depreciation Nil depreciation
Glass car parts Nil depreciation Nil depreciation

Analysis Of The Similarities And Differences Between Zero Depreciation Insurance And Comprehensive Insurance:

  • Similarities:
  • Both plans include coverage for both third-party liabilities and vehicle damage.
  • Both plans are voluntary.
  • Both plans offer premium concessions for safety devices, Car Association membership, other items, and no claim bonuses. *
  • Both of the plans allow for cashless claims.
  • Both policies’ coverage periods are one year.
  • With both plans, you can choose additional add-on coverage benefits.
  • Differences:
Points Of Difference  Comprehensive Insurance Zero Depreciation Insurance
Scope of cover Only own damage and third-party liability coverage Coverage for third-party liability, own injury, and parts depreciation
Claim pay-out Lower because the claim amount is reduced by depreciation Since depreciation is not subtracted from the claim amount, the amount is higher.
Availability Can be availed for cars of all ages Can be availed for cars aged up to 5 years
Number of claims As long as the policy’s IDV is not exhausted, claims are not limited. There may be a cap on the total number of claims you can submit for zero depreciation.

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*Standard T&C Apply

Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.

 

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