Which Plan Suits You Better: Zero Depreciation Or Comprehensive Insurance Cover?

Posted on: Feb 20, 2019 | 3 mins | Written by: HDFC ERGO Team

Which Plan Suits You Better: Zero Depreciation Or Comprehensive Insurance Cover?

Zero Depreciation Vs. Comprehensive Insurance

We congratulate you on the purchase of your dream car, an asset you wished and planned for a long time. While the mood is positive and happy, let it not fool you into taking it easy and ignoring another key purchase that not only complements your purchase but also necessitates – your car insurance. Similar to any other insurance product, your car insurance purchase must be subject to careful consideration. We at HDFC ERGO list down the two popular plans that often confuse most car owners – Comprehensive cover with Zero Depreciation Cover and regular Comprehensive Insurance Cover.

What is Zero Depreciation Car Insurance?

Zero Depreciation as the name implies, promises comprehensive coverage to your car in the event of any claim. This policy does not factor in depreciation, ensuring full settlement of your claim amount. In the event of any unfortunate accident, we at HDFC ERGO ensure that your entire cost is taken care of under your comprehensive car insurance with zerodepreciationcarinsurance.

Predictably, this policy is extremely popular amongst a majority of car owners due to its comprehensive coverage. While the policy premium may cost a tad bit more than your standard policy, it guarantees peace of mind. Also known as the bumper to bumper cover, this policy ensures that the normal wear and tear does not impact your settlement amount. Zero depreciation benefit can be availed only in case of partial losses.

What is Comprehensive Car Insurance?

In the event of certain events like theft, fire and vandalism; a Comprehensive Insurance Cover settles your loss and damage claim. The claim amount in such a policy takes into account the current value of your car, after considering depreciation. We at HDFC ERGO offer you various add on options, that allow you to widen your car insurance coverage. Unlike the Comprehensive cover with ZERO DEPRECIATION CAR INSURANCE cover, a Comprehensive Insurance Cover is much more economical. This policy is extremely popular with those car owners who prefer a wider coverage at the cost of depreciation.

Comprehensive Cover with Zero Depreciation Car Insurance vs Comprehensive Car Insurance

The most vital difference between a Zero Depreciation Cover and comprehensive insurance is that latter is a type of insurance plan while the former is an additional cover that can be included in the comprehensive insurance plan

Factors	Comprehensive Policy with Zero Depreciation Add-on	Comprehensive Policy without Zero Depreciation Add-on
Coverage of parts like metal, plastic, glass	Depreciation is not considered for these parts.	Depreciation is considered for these parts,before the claim amount is paid.
Premium	Usually higher than just a Comprehensive Plan.	Considerably less.
Claim	Higher amount as the vehicle depreciation is not considered.	Amount is low as the depreciation amount will be considered.
Cost of repair (plastic parts)	Covered by the insurer.	Usually not covered by the insurer.
Age of the Car	Depends on the insurer	Applicable for cars of all ages.

Benefits of a Comprehensive Car Insurance Policy

Below are some of the important benefits of opting for a COMPREHENSIVE CAR INSURANCE Policy:

1. Keep away from Penalties

Since a Comprehensive Plan includes the law-mandated Third party insurance Cover, you shall be safe from penalties associated with not following the law as far as buying insurance is concerned.

2. Savings

A Comprehensive Plan comes with Own Damage cover, major repair costs will be paid by the insurer if the car is damaged.

3. Coverage

With additional coverage for your vehicle along with the Comprehensive Plan, you can opt for add-ons such as Zero Depreciation, Engine Protection Cover, Roadside Assistance, NCB Protection cover, Passenger Cover, etc.

Benefits of Having a Zero Depreciation Add-on Cover

Here are some of the benefits of opting for this add-on.

1. Financial Security

With this cover, you will have the following insurance benefits leading to better financial security in case of vehicle damage/accidents.

• Third-party Liability Cover

• Own Damage Cover

• Zero Depreciation Cover

2. Claims

Since car depreciationparts are not considered while repairing/replacing them, you get a higher claim settlement amount. In other words, you have to pay less garage bill as a considerable portion will be covered by the insurer.

3. Managing policies smoothly

Zero Depreciation Add-on does not cost a lot and can be included without much expense; hence the financial impact of this inclusion leads to better policy management.

Conclusion

While both policies have their pluses and minuses, the choice of your insurance policy is primarily dependent on your need and situation. One must make an informed decision after carefully studying their individual clauses and features.

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

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