Before going to understand about zero depreciation car insurance policy, we would like to give you a clear definition of depreciation – A depreciation is a markdown in the value of assets due to factors such as age, wear and tear.
As you now understood about the depreciation. Let’s understand what is zero depreciation and why should buy zero depreciation cover?
What is Zero Depreciation Car Insurance?
Let’s understand the zero depreciation meaning with this example. In an event of an accident, if you car is damaged, you can get the full coverage against all physical damage without factoring in depreciation. That means, the insurance company will give you the whole replacement amount without any deduction and you don’t need to pay a single penny from your pocket.
We know you are very happy with your new car, and now you are seeking for the best insurance policy that gives you full coverage against all unexpected physical damage. So, for your better understating, here we have comprehended below the zero depreciation car Insurance benefits over normal car insurance cover.
Zero Depreciation Car Insurance Cover vs Normal Car Insurance cover
- Basic Definition: As the term implies, zero depreciation mean nil depreciation, your insurance company will provide you 100% coverage against all physical damage. On the other hand, normal depreciation cover is a plan that doesn’t offer you full settlement against physical damage.
- Engine coverage: Zero depreciation cover and normal depreciation cover don’t offer coverage against engine damage due to water ingression or oil leakage.
- Coverage: In zero depreciation policy company offers complete coverage and depreciation will not make a dent. Whereas in normal depreciation Policy Company offers you a claim amount that based on the current value of the vehicle, in this policy depreciation will make a dent.
- Premium: The premium to be paid for zero depreciation policy is relatively higher than a premium to be paid for normal depreciation policy.
- Age of Car: Only new cars can get zero depreciation policy. Whereas normal depreciation cover policy for cars which are more than 3 years old.
Why Should buy Zero Depreciation Car Insurance?
No matters, whether a car is damaged or stolen, car insurance covers all the losses against the unexpected consequences. As per the insurance policy guidelines, when car damage, you cannot avail the request for 100% reimbursement during the time of claim. But, in zero depreciation cover, you can. This policy gives you full settlement against all physical damage. Thought, you have to pay slightly more as compared to other normal insurance. But, with this policy, you can be assured and drive effortlessly.
If you buy a new car and you drive daily more than 30 km then it is worth to buy zero depreciation policy. This policy is a safeguard and allows you to drive with a peace of mind.
Still, you have a doubt about this policy let’s clear your perception with this example.
Mr. A had a new car and bought a normal car insurance policy. On the other hand, there was a Mr. B who also had a new car but they bought a zero depreciation policy. Unexpectedly, their both new cars suffered from serious damage. In that time, Mr. A who had a normal car cover he didn’t get full coverage against means he got the amount after subtracting depreciation. While Mr. B who had a zero depreciation policy was getting a full settlement against serious damage.
Zero Depreciation Car Insurance Benefits
Before you avail a request for zero depreciation car policy, it is worthwhile to look at its benefits:
- Individuals who have a new or luxury car and usually drives in highway or twisting hills, it is worth to buy zero depreciation cover. Because it offers coverage without considering depreciation.
- Zero depreciation insurance gives you full coverage against all physical damage effortlessly.
- Must buy for new/ inexperienced drives who drive new and luxury cars.
- After buying this insurance you can drive confidently even in the hill areas, just to make sure don’t drive out of your control.
- This policy provides you full coverage on replaced parts with no deduction on account of depreciation.
- However the premium in this policy is more than normal insurance, but you will not have to pay anything at the time of repairing.