What is Zero depreciation in car insurance?

Here’s why a Zero Depreciation Insurance Plan for your car means zero hassles for you.

Cars, like all commodities, get old with the passage of time. The clinking of metals, guzzling of fuel and rattling of parts lead to wear and tear, reducing the value of individual parts, and in turn, the car at large. This phenomenon of your car’s value going down with time is called depreciation. Most insurance plans, including many comprehensive ones, do not cover depreciation. So, when you make an insurance claim – in the event of an accident or major repair work – the insurer calculates the value of your car, keeping the depreciation in mind. This means, even with a comprehensive insurance plan, there could be a disparity between the actual cost of repair and the claim (insurance page) settlement amount.

However, you can save yourself from the trouble of varying expenses and repair costs, with something called Zero Depreciation Insurance. To answer the question of how it helps you - it essentially makes up for the portion of the claim that gets deducted because of depreciation. In insurance jargon, it is also known as nil depreciation or depreciation reimbursement.

Your Protect yourself certainly helps you, but Zero Depreciation further takes care of the limitations your car insurance may have. What you must know is that Zero Depreciation can be exercised only while covering the first two claims. However, on occasions where no parts are replaced, depreciation is not deducted, which means it doesn’t get classified as a claim under the cover.

Zero Depreciation comes in handy to anyone and everyone with a car. But it is even more important if you fall in one of these categories:

If you just bought a car:

The value of your brand new car starts depreciating once it completes a period of six months. After this, every small scratch, dent and mechanical problem will result in a visit to the garage and an inevitable, elaborate bill. Which is why, it’s prudent to get this cover as an add-on to your car insurance

If you have just started driving:

Driving on Indian roads is not easy, especially if you’re in a big city. Any new driver takes time to get accustomed to the ways of the road, and a few scratches here and there are only natural. So, to Protect yourself from the expenses of accidental scratches and damage, you should definitely opt for a Zero Depreciation Insurance Plan and ensure getting the full claim amount.

If you own an expensive car:

An expensive car offers comfort and luxury, but it also means paying premium prices for repairs and maintenance. Getting parts of your luxury car replaced usually amounts to twice or more as compared to the parts of a regular sedan. So, here again, a Zero Depreciation Plan goes a long way in protecting you from unforeseen expenses.

A lot of people look at Zero Depreciation as an expense, as the add-on cover makes the insurance plan more expensive. But it takes a little foresight to see how it can be a smart way to save money on your car. Much like car leasing, which has established itself as a smart solution for all your mobility needs. ALD Automotive is a front-runner in the corporate car leasing segment. They not only give you a cost-efficient way to commute and travel, but also offer a bunch of add-on services like maintenance, insurance, door to door service and stand-by car. They partner with insurance companies to carry out several tasks on your behalf, which include arranging the ideal insurance cover for your car, ensuring roadside assistance at any time of the day and renewing the insurance each year. In addition, they regularly follow-up with workshops when your car requires repairs, and even manage the payment for you. With their insurance services, you can get your car covered against accidents, fire, lightning, burglary, theft, riots, earthquakes, floods, storms, cyclones, malicious acts and terrorism. To know more about car leasing and better understand the services offered, you can visit aldautomotive.in