What Is Zero Depreciation Cover for Bike Insurance

What does Zero Depreciation Bike Insurance mean?

Zero Depreciation, also known as Zero Dep, bike insurance is an add-on that allows you to claim the complete amount without any depreciation deduction on different parts of the vehicle. It is sometimes referred to as bumper-to-bumper coverage (typically for cars) or nil depreciation. As an add-on to a comprehensive or own-damage two-wheeler insurance policy, policyholders can use Zero Dep insurance.

If you claim to repair or replace parts due to an incident, depreciation is usually deducted from the payout. With a Zero Dep add-on, the insurer pays for depreciated parts if they match your policy. When settling claims, your bike is considered ‘new’ to determine the settlement amount.

You can only claim Nil Dep insurance a limited number of times per policy period. This coverage isn't available with third-party insurance; it must be purchased as an add-on along with a comprehensive plan.

What is a Zero Depreciation Add-on?

The zero depreciation add-on kicks in to help you adjust the impact of depreciation and maximise your two-wheeler insurance. Zero Depreciation Cover is an add-on or rider to a comprehensive bike insurance policy that provides full coverage without accounting for any depreciation in the value of the insured bike or its parts.

This means that if an accident were to happen or damage were to occur to the bike, the insurance company would compensate for fixing or replacing the item(s) without factoring in any depreciation.

The inclusions of this policy are very clear. Here is what you need to understand.

• This add-on will compensate you for the replacement and repairs when settling the claim as if there is zero depreciation of the components, such as metal, nylon, plastic, and rubber.

• Some insurers may also offer compensation for the battery and tyres, excluding depreciation.

• You can purchase this cover only when you are purchasing a new policy or renewing an existing one.

• The number of claims permitted annually under the zero depreciation rider varies between insurers and depends on the policy's terms and conditions.

What Is Depreciation in Bike Insurance?

Depreciation refers to the gradual decrease in the value of a two-wheeler over time due to wear and tear. In bike insurance, depreciation plays a crucial role in determining the claim amount you receive for repairs or replacements.

When a bike is damaged, the insurer does not cover the full cost of repairing or replacing certain parts. Instead, a percentage of the price is deducted based on the material of the part, and the remaining amount has to be paid by the bike owner. This is because some materials, such as plastic, rubber, and fibre, degrade faster than others.

FAQs

What are the following factors that impact the premium for Zero Depreciation cover?

The premium for Zero Depreciation cover depends on several factors, including the age of your bike, its make and model, your location, the Insured Declared Value (IDV), and the insurance plan chosen.

What is the Zero Dep insurance for the bike price?

The Zero Dep bike insurance price depends on several factors, including the bike's make, model, age, location, IDV, insurer, and chosen insurance plan.

Is Zero Depreciation cover helpful for new bike owners?

Yes, Zero Depreciation cover is extremely beneficial for new bike owners or owners with bikes that are less than five years old. The cover guarantees that the entire claim amount is paid in full without any depreciation on parts.

Can I buy Zero Depreciation cover for an old bike?

Most insurers offer Zero Depreciation cover only for bikes that are less than 5 years old. Some insurers may extend it to older bikes after inspection, but availability varies.

Does Zero Depreciation cover all parts of the bike?

It covers the repair or replacement of parts, such as metal, rubber, plastic, and nylon, without depreciation. However, coverage for tyres and battery may vary depending on the insurer’s terms.