Zero-deprecation is one of the most helpful add-ons in car insurance. In case of damage, it ensures you get full compensation, without considering depreciation. This can result in much higher payouts as compared to a normal plan, especially considering how fast your car and its part can depreciate in value.
However, there are several misconceptions that cloud the air around zero depreciation car insurance. These half-truths can confuse customers, or worse still, cause them to ignore this form of cover. Keeping this in mind, the following article will highlight some of these misconceptions and help clear the air around zero-depreciation car insurance.
- Zero-depreciation car insurance is only available for new cars.
This is one of the first and most significant misconceptions about zero depreciation insurance. Most buyers assume that this form of cover can only be purchased for newer cars. However, this is not true! Many leading car insurance companies in India offer zero-depreciation cover for cars up to age 10 as well.
- Zero depreciation offers 100% compensation.
Some buyers assume that zero-depreciation cover will provide 100% compensation in case of a claim. However, this is not true! Zero-depreciation cover only cancels out the effect of depreciation. Therefore, in case of a claim, you will still have to cover the cost of consumables. Moreover, you will also have to pay the deductible applicable on your plan.
Note: The cost of consumables can also be covered under a car insurance policy. For this, one must include the consumables cover add-on to their insurance policy. This will cause a slight bump in the premium amount. However, it will provide compensation for the cost of consumables in case of a claim.
- You can make only one claim against a zero-depreciation policy.
This is another misconception that dissuades buyers from zero-depreciation car insurance. They feel that they will only be entitled to one claim in a year against such a policy. But this is again not true! One can make 2 or even 3 claims in a year against a zero-depreciation car insurance policy. The number of claims depends on the insurance provider, so be sure to check this before you buy the plan.
- Zero-depreciation covers wear and tear.
Zero-depreciation car insurance has its own set of exclusions, one of which is wear and tear. Other exclusions include things like mechanical slip-ups, tyres, gas & bi-fuel kits, total loss of the vehicle, engine damage due to oil leakage or ingression of water, etc.
- Zero-depreciation is very expensive
All add-ons will have their own separate cost. Therefore, they are bound to increase the cost of your car insurance policy. However, this add-on is not overly expensive. One can expect to pay 10 to 15 percent more to include zero-dep cover to their car insurance policy. Also, if you do not make a claim against your policy, your NCB will help reduce your out-of-pocket expenses considerably!
We hope this has been helpful for you, good luck and drive safe!
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