Traffic can be a big headache especially if you use a four-wheeler to commute from one place to another. There is a large chunk of our population that show no sense on the road and it’s generally this group of people who generally are the main cause or are involved in accidents that occur on our streets.
Having a good vehicle insurance can help minimize the amount of money that you spend on repairing a vehicle that has met with an accident. But, insurers can sometimes offer a lesser sum of money as compensation towards damages incurred by your vehicle.
This tends to happen to people who have taken out a comprehensive insurance cover for their vehicle but fail to take out a rider which would provide added benefits to your insurance cover. Zero Depreciation Cover is a rider that provides full compensation towards any damage that your vehicle could be subjected to in an accident.
What is Zero Depreciation Cover?
Known as Bumper-to-Bumper Cover, Zero Depreciation Cover offers compensation to the policyholder when needed without considering the depreciation value of the vehicle. The plan offers complete cover for your prized four-wheeler without factors like damage-caused or age-related depreciation playing a part at the time of compensation.
This cover basically eliminates any bills for repairs that you will have to clear if you didn’t purchase this cover along with the base insurance plan for your vehicle. The plan offers coverage to the cost incurred by the policyholder for repairing glass, fiber, plastic, and rubber parts. Any amount that has to be spent on the replacement of parts of the vehicle due to an accident is completely covered by this plan.
The Zero Depreciation Cover is generally offered by insurance agencies for cars that are relatively new (up to 5 years old) and this plan can be purchased by paying a cost that comes up to 15%-20% of the standard premium amount.
What is the difference of this plan when compared to a Standard Motor Cover?
In a Standard Motor Policy, rate of depreciation can range from anywhere between 0% to 40% and this depends on a few factors like type of material used, age of the vehicle, etc. With this plan, a policyholder will have to shell out money for any repairs that does not get covered under the policy. But with a Zero Depreciation Cover, no depreciation value is charged and hence, the policyholder will be entitled to a 100% reimbursement of parts.
Another main difference between the two types of plans is that the premiums that are paid towards a Zero Depreciation Cover is a lot more costly when compared to a Standard Motor Cover.
Who should purchase this cover?
Ideally, anyone who owns a four-wheeler and plans on protecting it from the costs of repairs incurred in an accident should pick up an insurance cover as a basic plan along with the Zero Depreciation Cover. Owners of vehicles which are new, luxury vehicles or anyone else who are afraid of their vehicle getting damaged on the road should consider purchasing this cover. This cover can be a little more expensive when compared to a Zero Depreciation Cover. But the benefits that come with this cover are a lot more intriguing and can comparatively cost lesser than paying for the replacement of parts or for repairs.
How do I purchase a Zero Depreciation Cover?
A customer who wishes to purchase a Zero Depreciation Cover can do so when purchasing the base cover for their vehicle. This can be done by paying the extra premium required to come under the umbrella of benefits of the Zero Depreciation Cover when making the premium payments for the comprehensive insurance cover.
Advantages of a Zero Depreciation Cover
The main advantage of a Zero Depreciation Cover is that you do not have to shell out any money out of your own pocket when repairing your damaged vehicle. With the Zero Depreciation Cover, the insurer will have to bear a majority of the costs in repairing or replacing parts of a damaged vehicle.
When a customer opts to purchase a Standard Motor Cover, the policyholder will have to cover a chunk of the cost of repairs while the entire amount is paid off by the insurance company with a [eafl id=”4177″ name=”” text=”Zero Depreciation Cover”]. As this plan eliminates the need of a policyholder to pay for repairs out of his/her own pocket, it is more viable to choose this plan over a Standard Motor Cover.
There are a few factors that you will have to consider before purchasing a Zero Depreciation Cover. It is not advisable to purchase this cover for a vehicle that is relatively old as the replacement and repair charges are relatively cheaper when compared to the work done on a new or luxury vehicle.
You will also have to consider the make and model of the vehicle, location, and frequency of accidents met in the same vehicle. There is a restriction on the number of claims that a policyholder can make with a Zero Depreciation Cover in a year.