Please enter your Keyword for Search


    Zero Depreciation: How to make the most of it!

    Imagine you’re driving your car and you accidentally hit another. You’re okay but your car needs some serious repairs.

     

    Aren’t you glad you have car insurance and now the insurer will pay for it?

     

    But what if you don’t get the claim amount you were expecting and have to pay some out of your own pocket? Not what you had expected, right?

     

    This is what zero depreciation cover does to your claims.

    What is depreciation?

    With time and usage, each part of the car wears out. Owing to this, the value of these parts decreases as well. This depreciation is directly related to the age of the car. So, when you make a claim, the insurer calculates the value of your car or its part after factoring in depreciation, and only then do you get the settlement amount.

     

    The rate of depreciation for all parts is as follows –

     

    Subject to a deduction for depreciation at the rates mentioned below in respect of the parts replaced
    For All Rubber/ Nylon/ Plastic Parts, tyres, tubes and batteries 50%
    For Fibre glass components 30%
    For All Parts made of Glass Nil

     

     

    The rate of depreciation for all parts including wood is as follows –

     

    AGE OF VEHICLE  % OF DEPRECIATION 
    Not exceeding 6 months  Nil 
    Exceeding 6 months but not exceeding 1 year  5%
    Exceeding 1 year but not exceeding 2 years  10%
    Exceeding 2 years but not exceeding 3 years  15%
    Exceeding 3 years but not exceeding 4 years  25%
    Exceeding 4 years but not exceeding 5 years  35%
    Exceeding 5 years but not exceeding 10 years 40%
    Exceeding 10 years 50%

     

     

    This means, if you make a claim of Rs 10000 for your 4-year-old car, the insurer will not pay more than Rs 6500. This is why every car should have depreciation reimbursement cover or add-on.

     

     

    What is zero depreciation reimbursement cover or nil depreciation cover and how does it work?

    As the name suggests, the zero depreciation reimbursement cover or nil depreciation cover reimburses or compensates you the amount of claim that gets deducted due to depreciation. If we take the last example, instead of paying you Rs 6500, the insurer will pay you the full amount* if your insurance policy has the add-on. It’s important to note that this add-on is only available for cars that are not more than 5 years old.

     

    Zero or nil depreciation reimbursement cover can only be used for the first two claims in the policy period, so be prudent with your claims. But rest assured, in a claim where no parts are replaced and thus therefore no depreciation has been deducted, it won’t be counted as a claim under the cover.

     

    What you need to know

    •  It does not cover normal wear and tear or even mechanical breakdown of your car.
    •  It covers all expenses incurred due to damage to car paint, rubber and plastic parts, batteries, tyres and so on.
    •  The add-on only operates up to 2 times in a policy period.

     

    Whereas a comprehensive car insurance will take care of your car and the repair costs, even that has some limitations. This is where depreciation reimbursement cover can be of great help to you by ensuring that it fills the gap between the actual damage and the claim settlement amount. It gives you relief from unforeseen expenses, as well as peace of mind.

    Who needs it the most?

    While anyone with a car less than 5 years old should have depreciation reimbursement cover or add-on, it is especially important for the following people:

     

    • Someone who just bought a new car- The value of your car starts depreciating the moment it hits the 6-month marker and after that even a little bump might send your car to the garage. So, get this cover along with the policy to protect your new car.
    • Someone who just started driving- If you are a new driver, you take time to adjust to the road, and are more likely to damage your car. So, this cover would help you get the claim. 
    • Someone who owns an expensive car- Luxury car parts can cost you twice or thrice as much the normal prices. And in the event of an accident or damage, it can be a very heavy price to pay since even 5% would mean a lot here. So, save yourself the trouble and get the add-on now!

     

    Whereas a comprehensive car insurance policy will take care of your car and the repair costs, even that has some limitations. This is where depreciation reimbursement cover can be of great help as it fills the gap between the actual repair amount and the claim settlement amount.

     

    So, don’t be surprised, get zero depreciation reimbursement add-on.

     

    To know more visit: https://www.tataaig.com/motor-insurance

    Or Call Toll Free number: 1800 266 1363

     

     

    Note –

     

    *Depreciation Reimbursement claim is payable only if Own Damage Claim is admissible & vehicle is repaired at Tata AIG’s authorised garage/workshop.

    *A compulsory excess deduction of Rs. 1000 or Rs.2000 based on the Cubic Capacity of the vehicle is applicable during claims.  

     

    • It does not cover normal wear and tear or even mechanical breakdown of your car.
    • It covers all expenses incurred due to damage to car paint, rubber and plastic parts, batteries, tyres and so on.
    • The add-on only operates up to 2 times in a policy period.

     

    Whereas comprehensive car insurance will take care of your car and the repair costs, even that has some limitations. This is where depreciation reimbursement cover can be of great help to you by ensuring that it fills the gap between the actual damage and the claim settlement amount. It gives you relief from unforeseen expenses, as well as peace of mind.

     





    Terms of Use | Privacy | Sitemap | Brokers | Tata Group | AIG | Chartis | Tata AIA Life Insurance | IRDA CEW | US Visitor Visa | Tata Medical Center | Insurance Institute of India

    2008, Tata AIG General Insurance Company Limited, all rights reserved.

    Registered Office : Peninsula Business Park, Tower A, 15thFloor, G.K.Marg, Lower Parel, Mumbai-400 013, Maharashtra, India. CINNumber : U85110MH2000PLC128425.

    Registered with IRDA of India Regn. No. 108. Insurance is the subject matter of the solicitation.

    For more details on benefits, exclusions, limitations, terms and conditions, please read sales brochure/policy wording carefully before concluding a sale.

    Toll Free Number : 1800 266 7780 / 1800 22 9966 (only for senior citizen policy holders). Email Id –customersupport@tataaig.com. Fax Number – 022 66938170