Zero Depreciation add-on in Car insurance- Is it really necessary?
Buying a car is a dream for many of us. While purchasing a car we put a lot of effort in deciding the make, model and many other things. The Car insurance is normally taken from the showroom for the brand new vehicle and subsequent renewals are normally done from outside. It is equally important to be attentive in deciding the insurance for your car as you don’t want to have a heart break at the time of claim.
There are many add-ons available in the motor insurance such as nil dep insurance, 24*7 road side assistance, engine protection etc. Among these covers the most opted cover is zero dep cover as the point of taking insurance is fulfilled if only the depreciation cover is opted.
Having an insurance policy without Zero dep is like having an insurance policy with Co-pay. At the time of claim you need to bear the expenses calculated on the depreciation.
Is it necessary to take Zero Dep Cover?
Many of us might have faced the dilemma while purchasing the car insurance policy whether to include the Zero dep cover. If you are taking car insurance online without opting for zero depreciation then be ready to shell out some amount of money at the time of claim as the cost for depreciation is not covered under the comprehensive policy.
Let us understand the need for zero dep cover with an example:
For instance Ms.Monni car was due for renewal and has decided to go for only comprehensive insurance as there was no claim in the previous year and she felt that the amount of premium she paid was too high. So, she went online to search for online car insurance where she entered her car details and car insurance quotes are displayed. She made use of online car insurance calculator to calculate the premium and finally selected the best one and paid online to receive the policy copy.
After a month she has met with an accident and the rear side of her car was damaged. She then took the vehicle to nearby garage and the claim estimate was given as Rs.50000. The depreciation cost for replacement of parts was Rs.25000 in the total bill. The insurer has deployed and the final claim amount was approved to be Rs.25000 by the insurance company.
Ms.Monni was shocked to see that she had to pay nearly half of the claim amount from her pocket which was really disappointing to her. Had she opted for the Zero dep add-on the entire claim amount would have been settled by the insurance company.
She had saved Rs.6000 by not opting for Zero dep add-on but ended up paying four times that saved amount at the time of claim. This difference should be enough to understand the importance of zero dep cover in car insurance.
Who should take ZERO DEP Cover?
Zero dep cover should be taken:
- If your car is brand new then it is advisable to opt for zero dep add-on. The cost of repair or replacement of high end cars such as Audi, Benz and BMW is quite high and even have a high depreciation rate too.
- Sometimes experienced drivers are also responsible for the accidents for no fault of theirs. It might be because of some drunk driver hitting your car or inexperienced driver hitting your car.
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