Zero Depreciation Vs. Comprehensive Two Wheeler Insurance Cover

Posted on: Apr 25, 2019 | | Written by:

Zero Depreciation Vs. Comprehensive Two Wheeler Insurance Cover

Published on September 21, 2022. EST READ TIME: 3 minutes

Buying a two-wheeler insurance policy is a legal mandate in India as per the Motor Vehicles Act, 1988. The Motor Vehicles Act, 1988 makes it mandatory for a two wheeler owner to insure his two-wheeler with a third party liability insurance policy. The coverage under third-party insurance is limited as it only covers the costs arising out of damages caused to third party or property. Due to this, many vehicle owners opt for a comprehensive cover as it is a mix of own damage and third party cover. Just by paying a little extra premium, one can insure his prized possession with a comprehensive two wheeler policy.

Since the insurance company offers a wide range of options for providing coverage to your two-wheeler, you may often end up getting confused between comprehensive and zero depreciation cover. But ideally, owing to the different coverage offered under comprehensive cover and zero depreciation cover, these covers are completely different from one another and in fact zero depreciation cover is an add-on that you can purchase to supplement your comprehensive two-wheeler policy. Read below in detail to understand the difference between the two.

What is Zero Depreciation Cover?

Depreciation means the reduction in the value of your vehicle and its parts over the years of its usage. At the time of making a claim, you may end up paying a large amount of claim amount from your pocket since the insurance company deducts depreciation amount charged against the damaged parts. But opting for a zero depreciation cover can help you save on the out of pocket expenses as with this cover, the depreciation amount charged against the damaged parts would be borne by the insurance company.

Tyres and batteries are excluded and this add on cover can be exercised only in case of partial loss and not in case of total loss/theft.

Inclusions of Zero Depreciation Bike Insurance Add-On Covers

• Under zero depreciation cover, you can avail compensation for depreciable parts such as nylon, rubber, fibreglass and plastic parts.

• You can get compensation for the cost of replacement and repair at the time of claim settlement.

• Some plans also cover partial damages to batteries and tyres without calculating the depreciation.

• You can opt for the zero depreciation cover at the time of purchase and renewal.

Exclusions of the Zero-Depreciation Bike Insurance Add-Cover

• Zero depreciation does not cover any uninsured perils.

• Damage caused because of mechanical faults.

• No coverage for routine ageing and wear and tear of parts.

• Total damage or loss of the vehicle

• It does not cover damage caused to uninsured bike items such as tires, bi-fuel kits, and gas kits.

What is Comprehensive Insurance?

Comprehensive insurance is a type of insurance policy that protects your vehicle against any damage in addition to any third party liability in terms of death/bodily injury/property damage. Along with comprehensive insurance policy, you can opt for various add-on covers such as zero depreciation and , roadside assistance .

Inclusions of Comprehensive Bike Insurance

• Accidents –

With HDFC ERGO’s network of 7600 plus cashless garages, you can get your two-wheeler repaired without any hassle after meeting with an accident.

• Fire & Explosion–

Any damage to vehicle due to these perils are covered.

• Theft–

The insured person will get coverage for total loss of two-wheeler due to theft.

• Natural Calamities -

You get coverage for your two-wheeler if it gets damaged due to earthquake, landslide, floods, etc.

• Third Party Liability-

In the event of an accident HDFC ERGO two-wheeler insurance cover legal liability for injury, death and/or property damage caused to a third party.

• Personal Accident Cover-

You can opt this "Personal Accident Cover" for owner driver, only if you have valid driving license. You can skip this cover, if you have personal accident policy of Rs 15 Lakhs or have another motor insurance policy with "Personal Accident Cover" of Rs 15 Lakhs.

Exclusions of Comprehensive Insurance

• Consequential damage is not covered

• Coverage is not provided when driving under the influence of alcohol or drugs

• If the policy is not in force

• If the vehicle is used for commercial use

• If the vehicle is used for malicious activity

• The only difference is that in zero depreciation customer gets depreciation amount against the damaged parts and is available only up to 5 years old vehicles.

Zero Depreciation Cover vs Comprehensive Cover

Factors	Zero Depreciation Cover	Comprehensive Cover
Claim Settlement	The settlement of the claim will depend on the vehicle's age and the parts' depreciation value.	When you have bike insurance with zero depreciation cover, you get total compensation at the time of claim.
Premium Cost	Premium cost for bike insurance with zero depreciation cover is higher, however it is beneficial in the long run.	Premium without zero depreciation cover is less.
Repair Cost	The cost of repair is borne by the insurer.	The cost of repair and plastic fibre parts are paid for by the insured.
Age of Vehicle	It covers vehicle up to specific age only.	It covers vehicles up to any age, there is no age limit.

Conclusion

When purchasing a bike insurance policy, it is advisable to have comprehensive two-wheeler insurance, as it provides overall coverage to your vehicle. You can opt for zero depreciation cover if your bike usage is very high and this cover will help you get total compensation at time of claim.

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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