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.
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.
A zero depreciation cover should ideally be opted by the following:
- New two-wheeler owners
- People who have luxury two-wheelers which have expensive parts
- People living in accident-prone areas
- New drivers
Which bike do you ride?
Zero Depreciation Cover vs Normal Insurance
Age of two-wheeler
Rate of Depreciation Without Zero Depreciation cover
Rate of Depreciation With Zero Depreciation cover
Under 6 months
6 months to 1 year
Above 10 years
Part of two-wheeler
Rate of Depreciation Without Zero Depreciation
Rate of Depreciation With Zero Depreciation
Rubber/nylon/ plastic parts
Fibre glass parts
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.
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