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Return To Invoice Cover

Buying a car is an aspiration that a lot of us have. It is an important milestone as well as a major decision in your life. Thus, it only makes sense to secure your prized possession with a good insurance policy. You have the option to either opt for a third-party liability policy or a comprehensive policy.

A third-party liability policy is a mandatory policy that each car buyer must possess to be able to drive their car legally on the roads. This policy covers liabilities arising out of damages or injuries in case of accidents.

On the other hand, a comprehensive policy offers additional coverage in the event of loss or damages due to natural calamities such as floods, earthquakes, etc. or man-made calamities such as strikes, riots, vandalism, etc.

One of the major advantages of opting for a comprehensive insurance policy is that you can choose add-ons for your policy. With the help of add-ons, you can extend the coverage of your car insurance policy.

What is Return to Invoice?

If the car of an insured were to be damaged beyond repair or lost, the insurance company is a liability to pay only the IDV or the insured declared value of the car. The IDV of a car, which should not come as a surprise, reduces with time. Thus, you will end up losing your car and not even get adequately compensated.

This is where the Return to Invoice add-on comes into the picture. The add-on ensures that the insurance company pays you the amount mentioned in the invoice of the car and not the IDV. This includes taxes and registration charges. The add-on helps the car owner recover the original value of the car in the case of a total loss.

Why Is It Important?

Once you factor in depreciation, the value of your car might reduce dramatically over a couple of years. So, the Return to Invoice cover is extremely useful if your car suffers severe damages and cannot be repaired.

It must be noted that the add-on is not particularly helpful for petty damages. It serves the purpose to compensate you with the invoice price of the car in the case of a total loss. Insurance companies tag a car as a total loss if the repair costs exceed 75% of the car’s IDV. The other scenario where Return to Invoice cover can save the day is when your car is stolen.

Legal Need for Insurance

The Motor Vehicle Act of the country mandates all vehicles to have valid car insurance policies. If a person is found to be driving without valid insurance, they are liable to pay hefty fines. A third-party liability policy will ensure that you get the much-needed legal clearance to drive your vehicle on the public roads.


When you are buying a car, it is mandatory to also buy a car insurance policy. It can offer financial assistance in more than a few scenarios. The Return to Invoice cover can further enhance your policy’s capabilities by providing compensation in the case of a total loss.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

This blog has been written by

Mukesh Kumar | Motor Insurance Expert | 36+ years of experience in insurance industry

A veteran in the insurance industry, Mukesh Kumar has the expertise of handling various functions like Business Development, Underwriting, Claims, Human Resources, Quality Management and Marketing. With rich knowledge of the industry, he loves to share his views on topics of insurance sector and takes special interest in educating people on advantages of having insurance.;

Mr. Mukesh Kumar recommends"getting your two wheeler insured from HDFC ERGO, a brand serving more than 1 crore+ customers. With overnight repair services and more than 6,800+ network garages, you can be assured of help in event of any damage to your vehicle".

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