Zero Depreciation Two-Wheeler Insurance Cover
Depreciation is the reduction in the value of a two-wheeler due to normal wear and tear over a duration. In case you wish to get a complete bike insurance claim settlement amount without going through any reduction then you must opt for a zero depreciation or bumper to bumper add-on cover along with your standard bike insurance plan.
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What Does Depreciation Mean?
Depreciation is a phenomenon that refers to the decrease of the value of an asset over a period of time, such as a decrease in the value of an asset each year as it is used. Just like any other asset, the value of a two wheeler also decreases with time and its use. The responsibility to bear the cost of depreciation on the two wheeler falls on to the owner by default.
Therefore, at the time of making a claim for a two wheeler insurance policy, the insurer can deduct 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 Cover?
Zero Depreciation two wheeler insurance is also known as ‘Nil Depreciation’ and is one of a popular two-wheeler insurance add-on covers. Zero Depreciation add-on cover can be opted with a comprehensive and 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 the unlimited number of zero depreciation claims during the tenure of a policy.
Zero Depreciation Bike Insurance Cover should ideally be opted by the following:
- New drivers
- New two-wheeler owners
- People living in accident-prone areas
- People who have luxury two-wheeler which has expensive parts.
Calculate Your Bike Insurance
Compare: Depreciation in Two Wheeler Insurance with & without Zero Dep Cover
Age of Two-wheeler
Depreciation Without Zero Dep Cover
Depreciation With Zero Dep Cover
Under 6 months
6 months to 1 year
Above 10 years
Applicable Rate of Depreciation on Two Wheeler Parts
Part of Two-wheeler
Rate of Depreciation Without Zero Depreciation
Rate of Depreciation With Zero Depreciation
Fibre glass parts
Benefits of Zero Depreciation Bike Insurance Cover
Highlighted below are the benefits of a two-wheeler insurance policy with zero depreciation cover:
- Higher Claim Amount
Before providing the claim amount for the repairs of your two wheeler, the insurance company takes depreciation rate for different parts of two wheeler into account. Different parts of bikes have different depreciation rates, moreover, the claim rates also get affected based upon the age of your two-wheeler.
- Enhances The Coverage
A zero depreciation add on cover enhances the basic coverage of your two-wheeler insurance policy, and almost reduces your expenses to zero. By investing a little amount for the add-on cover, you get a better claim amount that will also enhance your savings.
- Repair Cost Without Depreciated Value
Any expenses that may arise due to repair of the two wheeler’s insured parts are worked out without taking depreciation value into account.
- Save More Money
With a zero depreciation add-on cover, the amount of premium becomes a little higher, but, in case of an accident or mishap, no depreciation will be imposed on your bike and the claim amount will be calculated without depreciation helps you get higher compensation. The amount of compensation you earn with this cover is usually much higher than the premium paid for this add-on, which helps you save more money in the long run.
- Higher Compensation
The maximum amount of claim which you are entitled to receive for your bike is determined by the IDV of bike insurance policy. The compensation amount is directly influenced by the rate of depreciation applied to the parts of the bike. Therefore, with the zero depreciation bike insurance add-on cover, you can get claims without getting affected by any depreciation rate of the bike which ultimately helps you get a higher amount of your claim.
- Peace of Mind
Bike insurance gives you a layer of protection for you and your bike against any damage, loss, injury, and so on, which brings peace of mind. Your amount of compensation gets further increased by a zero-depreciation add-on cover as it negates the rate of depreciation applicable on different parts of your bike. Hence, driving a bike knowing that any mishap will make you get the complete compensation for it will give you peace of mind for sure.
How To Purchase Zero Depreciation Bike Insurance Cover?
With the onset of technology, purchasing a zero depreciation cover alongside the basic plan for your bike is very easy. The policyholder can easily purchase the add on cover online at the time of buying or renewal of your bike insurance policy. You can simply choose the zero depreciation cover when you are buying a comprehensive plan for your bike insurance.
What All Things Are Included In a Two Wheeler Insurance Policy With Zero Depreciation Cover?
Below mentioned aspects are covered under a two wheeler insurance policy with zero depreciation add-on cover:
- Compensation for depreciable parts such as rubber, fiberglass, plastic and nylon parts of the two wheeler is provided.
- The total number of permissible claims under a bike insurance plan with zero depreciation can differ depending on the insurance provider.
- Compensation for the repairs and replacements of the parts of the two wheeler is provided during claim settlement.
- A zero depreciation add-on cover can be availed during both purchase and renewal.
There are certain insurance plans that provide coverage against partial damages to the tyres and batteries without calculating the depreciation.
What All Things Are Excluded In a Two Wheeler Insurance Policy With Zero Depreciation Cover?
The following conditions are not covered under a two-wheeler insurance plan with zero depreciation add-on cover:
- Loss or damage because of an uninsured risk or hazard.
- Routine wear and tear of insured vehicles.
- Damage or loss because of mechanical breakdown
- Loss or damage to items that are not insured such as tyres, bi-fuel kit, and gas kits.
- The duration for most of the zero depreciation add-on cover in the industry is around 1 year and the policyholder should renew it annually to avail the benefits of the cover. In case, you do not have a zero depreciation add-on cover, you can purchase it alongside two-wheeler insurance or go for it at the time of renewing your insurance plan.
What is the Cost of A Zero Depreciation Cover? What Makes it Worth the Price?
Generally, a zero depreciation add-on cover costs almost 15% of the bike insurance premium. Though it may seem to be a high amount of price for a bike insurance add-on cover, it is certainly worth the cost of the zero depreciation add-on cover as the amount of compensation which you will receive due to this add-on cover will prove to be significantly higher than the amount of its policy premium.
Things to Keep in Mind About the Zero Depreciation Add-on Cover?
When it comes to purchasing a zero depreciation add-on cover for your bike insurance, here are a few points which you should always keep in mind:
- This add-on cover is available only for bikes not more than two years old.
- The zero depreciation add-on does not deduct the compulsory deductibles.
- The zero depreciation add-on claims are allowed generally two times in a year.
- Zero depreciation cover offers the same coverage as the bumper-to-bumper cover.
What are the Conditions to Avail Zero Depreciation Add-On Cover?
It is extremely important to go through the policy document carefully and comprehend the conditions related to each add-on cover. Generally, a zero depreciation cover can be availed under the following cases:
- In case the two-wheeler insurance is entirely damaged or got stolen, then in such a case zero depreciation add-on cover is not applicable.
- This add-on cover can be availed only 2 times during the whole policy duration.
- If any loss or damage is suffered by the insured vehicle because of an accident or any other mishap, then for the repair purpose, two-wheelers should be sent to any network garage.
Note: These conditions can differ from one insurance provider to another. Therefore, at the time of buying an insurance plan with add-on cover, do enquire with the insurer to know more regarding the terms and conditions for zero depreciation cover.
Bike Insurance for Popular Bike Models
Two Wheeler Insurance Add-ons
Zero Depreciation Bike Insurance
- Bajaj Allianz
- Future Generali
- Hdfc Ergo
- Hdfc Ergo
- Icici Lombard
- Iffco Tokio
- New India
- Raheja Qbe
- Royal Sundaram
- Tata Aig
- United India
- Universal Sompo
Disclaimer: InsuranceDekho does not endorse, rate or recommend any particular insurance company or insurance plan.
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Explore Two Wheeler Insurance
Learn about Zero Depreciation Two-Wheeler Insurance Cover
- Comprehensive Insurance + Zero Depreciation = 100% Peace of Mind. Enhance your understanding about Comprehensive Insurance Cover and Zero Dep.
- Read along to know what is zero depreciation bike insurance add-on cover and why you should buy it.
- This article mentions the benefits of having a zero depreciation insurance cover for bikes.
- This article explains a zero depreciation bike insurance cover.
- This article highlights the difference between a zero depreciation cover and a bike insurance cover.
- Thinking to purchase zero depreciation bike insurance add-on cover? Read along to know why you should purchase it.
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Zero Depreciation Two Wheeler Insurance FAQs
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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