Comprehensive vs Zero Depreciation Car Insurance: Coverage, Calculator & Claim Process

What does Zero Depreciation Mean?

What exactly is zero depreciation meaning? To put it in simple terms, zero dep insurance protects your vehicle from the financial losses incurred due to ageing. With age, the value of the car falls. As a result, the IDV (current market value) also begins to depreciate. When you make a car insurance claim, the IDV is calculated and the claim amount is paid out accordingly. This leads to you receiving a lower claim amount. To work around this problem you need to invest in a zero depreciation cover.

What is Zero Dep/Zero Depreciation Car Insurance?

Now that you know what is zero depreciation car insurance, you should try to get this cover. You can also use the zero depreciation car insurance calculator for better understanding. But before doing so, keep the following points in mind:

1. Available as rider

The zero dep cover is commonly available as a rider with comprehensive motor insurance plans. Most people who opt for this cover buy the rider. Explore the options that are available, compare the policies and find your ideal with which you can keep your vehicle protected in the best way.

2. Not available for old cars

There is one very important clause associated with zero dep insurance that you should know. The zero depreciation cover cannot be applied to a vehicle that is older than five years. You can only opt for this cover if your car is aged five or fewer years. Also, the car is best suited for new and expensive cars that may need repairs to its expensive parts.

Some companies do provide Zero Dep cover for older cars, i.e. more than 5 years as well, but the options are limited and expensive. So, choose wisely.

3. Not a compulsory cover

Zero depreciation is not a compulsory car insurance cover. It is an add-on or extra cover that you can opt to buy. You won’t be legally held responsible if you are found driving your car without this cover.

Once you are aware of these factors, you will be able to understand what is zero dep car insurance is. Then, compare car insurance plans, find the most suitable cover, attach the zero depreciation cover and make the plan custom-made as per your requirements.

Car Depreciation Rates in India

Age of the car	% of depreciation
Cars less than 6 months	NIL
Cars more than 6 months old but < 1 year	5%
Cars more than 1-year-old but < 2 years	10%
Cars more than 2 years old but < 3 years	15%
Cars more than 3 years old but < 4 years	25%
Cars more than 4 years old but < 5 years	35%
Cars more than 5 years old but < 10 years	45%
Cars more than 10 years	50%

The components of the car also reduce in value over time:

Car Components	% of depreciation
Tyre, rubber parts, battery, nylon, tubes and plastic parts	50%
Glass and fibre materials	30%
All other parts made of glass	NIL

Who should Buy Zero Depreciation Car Insurance Cover?

So, wondering who should opt for Zero Dep Car insurance, here is the list:

1. Someone who is buying a brand new car or a pre-owned car that is less than 5 years old
2. If the car in question is a luxury/ highly expensive car
3. If the car is being used quite often
4. In case the driver is a learner and thus more prone to accidents

How to calculate zero dep Insurance Premium?

In order to calculate your zero dep car insurance premium, you can visit the PayBima Motor Insurance portal and use the zero dep car insurance premium calculator. Follow the steps to calculate the premium:

1. Enter the registration number of your vehicle, your mobile number and your email id
2. On the next page fill in details about the previous policy/ claims made etc, then click “Get Quote”
3. You can browse through the plans and compare the different car insurance plans available
4. You will be able to see the charges for the zero depreciation cover that is to be paid

Difference Between Comprehensive Insurance vs Zero Depreciation Car Insurance

Let us take a look at this table to help understand the differences between Zero Depreciation Cover and Comprehensive Cover:

Details	Basic Comprehensive Policy	Zero Depreciation
Nature	It is a standalone car insurance policy	This is an add-on cover that is attached to the base policy
Premium	Premium is more than third-party insurance but less as compared to Zero Dep	The premium increases by about 15% to 20%
Repair Cost	You need to make part payment when you make a claim	A much bigger share is paid by your insurer
Claim settlement	Made after deducting the depreciation value	Car depreciation rates are not applicable
Number of Claims	You can make any number of claims, however, you will lose out on your NCB	Under the Zero-Dep cover, you can make up to 2 claims in a policy year
Vehicle’s Age	Can be purchased for all vehicles	Comes with the restriction of 5 years

Difference Between Third-party Car Insurance vs Zero Depreciation Cover

Details	Third-Party Car Insurance Policy	Zero Depreciation
Nature	It is a mandatory car insurance coverage	Zero Dep is an optional add-on cover that can be attached to the base policy
Premium	The premium charges are nominal and less than comprehensive policy	The premium increases by about 15% to 20% of the regular policy
Coverage	Only third-party liabilities are covered	Depreciation charges are not payable by the vehicle owner
Number of Claims	Any number of claims may be made	You can make up to 2 claims in a policy year
Vehicle’s Age	Has to be purchased for all vehicles	Mostly comes with the restriction of 5 years

Car Depreciation Rates With and Without Zero Depreciation Cover

Age of the Vehicle	Rate of Vehicle Depreciation without the Zer Dep Cover	Rate of Vehicle Depreciation with the Zer Dep Cover
Within 6 months	5%	Nil
6 months – 1 year	15%	Nil
1 year – 2 years	20%	Nil
2 years – 3 years	30%	Nil
3 years – 4 years	40%	Nil
4 years – 5 years	50%	Nil