Zero Depreciation Two Wheeler Insurance

Zero Depreciation Add-on In Bike Insurance

Depreciation is a natural phenomenon that reduces the value of an asset over time. Just like every other asset, the value of a two-wheeler also diminishes with time. By default, the responsibility to bear the depreciation cost amount rests with the owner and not the insurance company. Therefore, at the time of claim settlement, the insurer deducts the cost of depreciation incurred by the insured’s two-wheeler from the claim amount. This makes the policyholder get a lesser amount of compensation from the insurer. However, a policyholder can shift the burden of bearing the cost of depreciation from himself/herself to the insurance company with the help of a zero depreciation cover.

What is Zero Depreciation Bike Insurance?

A zero depreciation add-on cover, also known as nil depreciation and bumper-to-bumper cover, is a popular two-wheeler insurance add-on cover. It can be opted with a comprehensive as well as a standalone own-damage two-wheeler insurance policy. It provides 100% depreciation coverage for all the parts of your two-wheeler except tyres, tubes and batteries which are covered at 50%. Most Insurance companies allow 2 zero depreciation claims during the tenure of a policy, however, there are some exceptions like IFFCO Tokio General Insurance, Royal Sundaram General Insurance Company, New India Assurance Company which allow unlimited number of zero depreciation claims during the tenure of a policy.

Zero Depreciation Bike Insurance Add- on Cover should ideally be opted by the following:

  1. New two-wheeler owners
  2. People who have luxury two-wheelers which have expensive parts
  3. People living in accident-prone areas
  4. New drivers

What is your bike's brand?

When did you buy your bike?
20042019
Have you made a claim in the previous year?

Zero Depreciation Bike Insurance Cover vs Normal Bike Insurance

Age of two-wheeler

Rate of Depreciation Without Zero Depreciation cover

Rate of Depreciation With Zero Depreciation cover

Under 6 months

Nil

0%

6 months to 1 year

5%

0%

1-2 years

10%

0%

2-3 years

15%

0%

3-4 years

25%

0%

4-5 years

35%

0%

5-10 years

40%

0%

Above 10 years

50%

0%

Part of two-wheeler

Rate of Depreciation Without Zero Depreciation

Rate of Depreciation With Zero Depreciation

Rubber/nylon/ plastic parts

50%

0%

Fibre glass parts

30%

0%

Glass parts

Nil

0%

Disclaimer: This article is issued in general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.


Add-ons For Your Bike Insurance Policy

  • Zero Depreciation

    Like other assets, the value of your bike also depreciates constantly with time and the liability of this expense by default rests with the policyholder. A zero depreciation add-on protects you against the depreciation expenses incurred by your bike. Thus, if you opt for a zero depreciation cover, depreciation expense of your bike is not deducted from your claim amount at the time of a claim settlement. This add-on is available with comprehensive bike insurance plans as well as standalone bike insurance plans. This is one of the most popular and recommended bike insurance add-on covers.

  • Invoice Protection

    In case of total loss (more than 70% damage) or theft of your bike, the insurance company pays you the Insured Declared Value of your bike as compensation. However, this Insured Declared Value (IDV) is less than the invoice price which you pay at the time of purchasing your bike. The Invoice Protection add-on cover helps you claim the Invoice Price, i.e. total ex-showroom price of your bike plus taxes plus registration charges, of your bike in case of total loss or theft of your bike.

  • NCB Cover

    No Claim Bonus is the reward which is given to the policyholder for not making any claim during the policy period. This reward is offered by the insurer in the form of a discount on the own-damage premium of the bike insurance policy at the time of policy renewal. The NCB ranges from 20% to 50% of the own-damage premium depending on the number of claim-free years. However, if you make even a single claim during the policy period this NCB gets lost. But, with the NCB Cover, you can keep your NCB intact even after making a claim during the policy period.

  • Engine Protection Cover

    The damages incurred by the engine of the bike are by default not covered under a bike insurance policy. However, if you opt for an Engine Protection Cover, the insurer will be liable to compensate you for damages incurred by the engine of your bike such as damage due to leakage of lubricants, water ingress, hydrostatic lock, damaged gearbox, broken crankshafts or pistons and cylinders. The repair cost of the internal engine parts is often high and can sum up to thousands of rupees or more. Thus, addition of this add-on to your comprehensive or standalone bike insurance policy can save you from these expenses.

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Zero Depreciation Two Wheeler Insurance FAQ

  • What is a zero depreciation cover in bike insurance?

    A zero depreciation cover for bikes is an add-on cover (extra coverage) which insures you against the depreciation charges incurred by your bike. By default, the liability for depreciation charges fall on the bike owner and thus the same is deducted from the claim amount at the time of claim settlement. However, if you opt for a zero depreciation cover, you are 100% exempt from paying the depreciation expense of your bike and all its parts except its tyres, tubes and batteries which are exempt at 50%. A zero depreciation add-on can be opted with a comprehensive bike insurance plan as well as a standalone own-damage bike insurance plan.

  • What is the best zero depreciation bike insurance in India?

    The best insurance company for a bike zero depreciation cover varies from individual to individual as per their requirements and budget. Generally, insurance companies allow up to 2 claims under a zero depreciation cover, however, there are only 3 insurance companies which allow unlimited number of claims namely IFFCO Tokio General Insurance, Royal Sundaram General Insurance and The New India Assurance.

  • Can I convert third party insurance for my bike into zero depreciation insurance?

    No, you cannot convert a third party bike insurance plan into a zero depreciation bike insurance plan. Like all other add-ons, a zero depreciation add-on can be opted with a comprehensive bike insurance plan or a standalone own-damage bike insurance plan.

  • What will I get covered in zero depreciation of bike insurance?

    A bike zero depreciation add-on covers the depreciation expense of your bike and offers compensation for repair and replacement of depreciated parts during the claim settlement process. It will cover the depreciation expense of all the parts of your bike at 100%, except tubes, tyres, & batteries, which are covered at 50%.

  • Should I buy zero depreciation bike insurance?

    Yes, you should buy a zero depreciation bike insurance cover as it insures you against the depreciation cost of your bike against a nominal additional premium amount. Also, this add-on helps you claim a higher amount by saving you from the expense of paying for the depreciation expense.

  • Is zero depreciation insurance required for bikes?

    A zero depreciation bike insurance add-on is not a mandatory requirement but is a recommended add-on. This add-on helps you get a higher claim amount and also saves you from incurring hefty depreciation expenses of your bike.

  • What is the difference between zero depreciation and comprehensive bike insurance?

    A comprehensive bike insurance is a type of bike insurance plan whereas a zero depreciation cover is a bike insurance add-on. A zero depreciation cover can be opted with comprehensive bike insurance plans and standalone own-damage bike insurance plans.

  • What is not covered by zero depreciation bike insurance?

    A zero depreciation cover for bikes does not provide coverage for 50% of depreciation charges incurred by tyres, tubes and batteries of the insured’s bike. Also, damages caused due to mechanical breakdown or to uninsured parts such as bi-fuel kit, and gas kits are excluded from the zero depreciation policy.

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