Difference Between Own Damage And Zero Depreciation Car Insurance
Difference Between Own Damage And Zero Depreciation Car Insurance
While buying a car insurance the most common terms one will come across are ‘own damage’ and ‘zero depreciation’. They brings into light one’s policy coverage as well as the way of calculation of the claimed amount.
Lets dive into the article to read about Own Damage Car insurance vs Zero Depreciation Car Insurance in depth!
Table of Contents
What is Own Damage Car Insurance
The type of insurance that helps the owner against the damages by self, these damages may be endured due to unanticipated events like natural calamities, road accidents, theft and many more. This type of car insurance leads one to get covered financially and obtain compensation for own damages.
In order to cover self damages endured by the car, one can buy car policy with a third party liability. According to the Motor Laws of India, it is compulsory to purchase third party car insurance as it cover losses like injury, death or property damage.
One can also avail own damage cover with the help of a Comprehensive car insurance policy as it covers both third party liabilities as well as own damage to the car, offering a more wider coverage. One can claim damage to the insured car only it they own a Comprehensive Car Insurance Policy.
As per the Insurance Regulatory and Development Authority (IRDAI), it has been made mandatory to own a motor insurance policy for each and every car purchased after 1 September, 2018, this states that every car insurance company must sell a bundled policy which offers three year party and one year self (Own) damage cover.
What is Zero Depreciation Car Insurance?
An additional cover purchased by the policy holder along with the Comprehensive Car Insurance is called Zero Depreciation Car Insurance and also known as Nil Depreciation Cover. It also provides coverage for depreciation over the car as well as its parts over many years.
One can purchase a zero dep add on, in order to do that one must pay some extra premium in addition to the price of car insurance.
Generally a normal insurance policy precludes normal wear and tear sustained over the years but Zero Dep add on, unlike others includes this and get this depreciation covered at one’s claim settlement which will further include both the amount of car depreciation and that of its parts.
Own Damage Car Insurance vs Zero Depreciation Car Insurance
|
Own Damage Car Insurance |
Zero Depreciation Car Insurance |
|
|
Inclusion |
Includes depreciation of the car insured and its parts |
Depreciation borne by the insured car is not included |
|
Premium |
Higher |
Lower |
|
Amount can be Claimed |
Claim amount is higher as depreciation amount is also included |
Claim amount is lower as depreciation amount is excluded |
|
Calculation of depreciation of Car |
Increase in depreciation is directly propotional with how old the car is |
Car’s age is not taken into consideration |
Conclusion
Zero dep add on might or might not be included under Own damage as it is totally dependent on the policy holder. A person must consider buying a Zero Depreciation add on along with their car insurance as it provides security irrespective of the car’s age and includes normal wear and tear sustained over the years unlike other Standard Insurance Policies. The premium on own damage is higher as compared to the zero depreciation car insurance and covers own damages endured by the car.
Also read: In India, Why And How Is A Car Insurance Background Check Performed?
