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Zero Depreciation Cover in Two-wheeler Insurance

Published on May 19, 2020, EST READ TIME: 5 MIN

An effective way by which you can ensure the protection and security of your two-wheeler is by insuring it.Without valid two-wheeler insurance, the financial liabilities you may incur in an accident can create a huge dent in your pocket. So, you should purchase two-wheeler insurance and remember to renew it at the end of the policy term.

This insurance policy is helpful in providing cover against damages or injuries caused to third party vehicles or persons in an accident and will also provide cover against the damages caused to the insured vehicle during an accident or natural/manmade disasters.

A standard comprehensive insurance policy for your two-wheeler has many exclusions. While processing a claim, the depreciation amount is deducted, which drastically brings down the amount especially in the case of an old vehicle. A two-wheeler insurance is important and by paying extra for additional coverage it becomes even more useful. A zero depreciation cover is one such cover.

Zero Depreciation Cover and Its Importance

Every two-wheeler undergoes a certain reduction in value over time. This process of decrease in value of the vehicle is known as depreciation. The value of the vehicle decreases due to the wear and tear of the machinery.

In a general two-wheeler insurance policy, the insurance provider covers the repair and replacement of the various components of the two-wheeler. The amount incurred is not included in the depreciation and the coverage is provided after the value of depreciation has been deducted.

Many insurance providers provide zero-depreciation cover as an add-on along with the basis two-wheeler insurance policy. When you have a zero-depreciation cover for your two-wheeler, your insurance provider will pay the entire amount for the parts that need to be replaced without making any deductions for depreciation. 

The following factors are included in a zero-depreciation cover two-wheeler insurance policy.

a.       By adding zero-depreciation cover to your two-wheeler insurance, you will be protected against the expenses incurred due to fiber, rubber, and nylon parts.

b.      As long as your two-wheeler insurance is valid, your zero-depreciation cover is valid for all your claims.  

Benefit versus Cost

The cost of two-wheeler insurance with zero-depreciation cover is higher than one that has no depreciation cover. But, the benefits offered by the zero-depreciation cover are completely worth the increased cost.

Some of the major benefits offered by two-wheeler insurance with zero-depreciation cover are mentioned below.

a.       This helps you in saving some money while making two-wheeler insurance claims since it will reduce your out-of-pocketexpenditure.

b.      It helps obtain a complete claim amount as there will be no deduction in the form of depreciation.

c.       Zero-depreciation cover acts as a layer of protection for your vehicle and its spare parts.

Hence, a two-wheeler insurance policy with zero depreciation cover is beneficial and can be availed at the time of policy renewal if it has not been availed while policy purchase. In the long run, having a policy with this cover offers many advantages especially in the time of a claim.

Disclaimer: The above information is for illustrative purposes 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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