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Cholamandalam Zero Depreciation Add-on


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Cholamandalam Zero Depreciation Add-on

Every commodity loses value over its age and so does your car. The continuous devaluation of a commodity is known as depreciation. Apart from reducing your car’s market value, depreciation also results in a reduction in the insurance claim amount of your car. This is because at the time of a claim, the insurer factors the depreciation cost in the claim amount.

Thus, even if your car is only 3-4 years old, your car will be valued at a price 25% less than the invoice price due to depreciation and you will receive a relatively lower claim amount. However, you can do away with the burden of bearing depreciation cost by purchasing the Cholamandalam Zero Depreciation add-on.

The zero depreciation add-on cover can only be availed with a comprehensive car insurance plan.

Cholamandalam Zero Depreciation Add-on Benefits

Higher Claim Amount: The zero depreciation add-on cover exempts the policyholder from bearing the cost of depreciation. It makes the insurer liable to pay for the applicable depreciation. Thus, the policyholder is able to get a higher claim amount.

Multiple Claims Even For Aged Vehicles: The policyholder can file 2 claims during the tenure of a policy. Also, the cover is available for cars up to 5 years of age. Both these things mean that all new car owners can make a total of 10 claims in a span of 5 years, if opted for 1-year tenure policy.

​Depreciation Rate Applicable on Car Without Zero Depreciation Cover

Age of Car

Rate of Depreciation

Under 6 months


6 months to 1 year


1-2 years


2-3 years


3-4 years


4-5 years


5-10 years


Above 10 years


Depreciation Rate Applicable on Different Parts of Car Without Zero Depreciation Cover

Part of Car

Depreciation Rate

Paint work / Rubber / nylon / plastic parts, tires and tubes, batteries and airbags parts


Fibre glass parts


Glass parts


Conditions for Zero Depreciation Add-on Cover

  • A maximum of two claims are permissible during the policy period for vehicles aged not more than 5 years.
  • The company will bear a maximum liability of Rs 20,000 per part to be replaced for vehicles with age not more than 5 years.

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Cholamandalam Zero Depreciation Cover FAQs

  • How much the Cholamandalam zero depreciation add-on costs?

    The cost of zero depreciation add-on cover depends on the sum insured and the age of the car. Also, irrespective of the cost, the company is liable to pay only a maximum of Rs 20,000 per part for cars not older than 5 years.
  • Is the zero depreciation add-on cover applicable in case of total loss/theft of the insured vehicle?

    No, the zero depreciation add-on cover is not applicable in case of total loss/theft of the insured vehicle. You must have the Invoice Cover add-on to get full showroom price of the vehicle in case of total loss or theft.
  • Are engine parts covered the zero depreciation add-on?

    No, the zero depreciation add-on cover does not offer protection for engine damage. To safeguard your car’s engine against losses/damages, you need to opt for the Engine Cover add-on.

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#Applicable on non-inspection cases i.e. existing policy has not expired or when buying a policy for a new vehicle.