Zero depreciation, also known as nil depreciation or bumper-to-bumper car insurance, is an add-on cover that can be purchased with a car insurance policy. This add-on cover ensures that the insurance company does not charge the depreciation sustained by the insured car. In other words, it offers complete coverage without factoring in the depreciation value of the vehicle. Typically, during claim settlement, an insurer deducts the depreciation value of parts before replacing the damaged parts. However, with this add-on, there’s no such deduction, and you receive the 100% claim. Zero depreciation costs anywhere between 15-20% of the standard premium and is recommended for all new or relatively new (up to 5 years) cars.
Here are some factors to keep in mind while opting for a zero depreciation car insurance:
- Zero depreciation cover offers settlement coverage without considering the depreciation value.
- Zero depreciation add-on cover is recommended for all brand new cars.
- Zero depreciation cover is also essential for relatively new cars (up to 5 years) .
- Zero depreciation add-on cover costs anywhere between 15-20% of the standard premium.
Zero depreciation car insurance proves to be beneficial to:
- People who own new or relatively new cars.
- People who want to avoid the impact of depreciation on their car insurance policy.
- People who want to receive the total cost of car parts during claim settlement.
In summary, zero depreciation is an add-on cover that can be purchased with a car insurance policy. It offers complete coverage without factoring in the depreciation value of the vehicle, ensuring that the insurance company does not charge the depreciation sustained by the insured car. It is recommended for all new or relatively new cars and costs anywhere between 15-20% of the standard premium.
