ZERO DEPRECIATION WITH CONSUMABLES COVER IN CAR INSURANCE

You may think that the comprehensive insurance policy you purchase for your car covers the cost of replacement of all parts in the event of damages suffered due to an accident. However, the reality is very different. When you file a claim, the insurance provider does not reimburse the full amount as per your claim. The company deducts the depreciation cost and cost of consumables and pays you the balance amount. The add-on zero depreciation with consumables cover annuls the depreciation charged on your vehicle and/or its parts and cost of consumables incurred and entitles you to receive the full value of the costs related to repairs and/or replacements as per your claim.

What is Consumables Cover in Car Insurance?

Certain parts, as well as components of your car, are subject to wear and tear in the normal course of their use. These parts and components are classified as consumables as they can be used only for a certain period. Therefore, consumables meaning in car insurance is that these components are being used up by the car and cannot be reused. In other words, such parts become useless after they are used once or the car is dismantled for some reason. In the case of a car, the consumables include the brake, gearbox, power steering, and engine oil; other lubricants such as grease; nuts; bolts; screws; washers; refrigerant used in the air conditioner; oil filters; radiator coolant; etc.

What is Car Insurance Consumables Add-on Cover?

The comprehensive insurance policy of your car does not compensate for any damages caused to those parts and accessories that are classified as consumables. At the time of settling your claim, you need to bear the cost of consumables from your pocket. The add-on ‘consumables cover in Car insurance’ helps you to avoid out-of-pocket payments.

As your comprehensive insurance policy does not offer this facility, you will have to pay an additional amount to cover the cost of consumables in Car Insurance. The premium payable, however, is dependent on the model of the car you are using. Having said that some of the conditions you need to be aware of when including this add-on to your car’s policy are:

• This add-on is not valid for cars that are older than five years
• You can claim only for your car’s consumables and not for a third-party vehicle
• For the claim to be valid, your car must have been repaired within 3 days after the accident has happened
• You need to submit your driving licence along with the claim document   

Also, it is important to know that under the following circumstances you will not eligible for any reimbursement.

• Driving under the influence of intoxicants
• Driving private vehicles for commercial purposes
• Normal mechanical/electrical breakdowns
• Regular consumables wear and tear
• Delay in intimating the insurance company

What is Zero Depreciation Cover in Car Insurance?

The Zero depreciation cover is also referred to as Bumper-to-Bumper or Nil-depreciation cover. When included in your car’s comprehensive insurance policy, this add-on eliminates the depreciation factor at the time of settlement of claims and entitles you to receive reimbursement in full, excluding batteries and tyres. The zero depreciation add-on offers 100 % coverage for all rubber, fibre, and metal parts. However, it doesn’t cover engine damage caused due to oil leakage or water ingression. Mechanical breakdowns, oil change, and consumables are also not covered by this add-on. Further, the add-on cover specifies as to how many claims you can file in a year.

The cost of including the zero depreciation cover can be anywhere between 15 to 20% of the standard premium to be paid by you. However, it is highly recommended that you include it in your policy if your car is new or less than 5 years old.

Zero depreciation add-on is beneficial to you if you:

• Have a new car or luxury car
• Are a new or inexperienced driver
• Live in an accident-prone area
• Worry about small dents and bumps on your car
• Have to pay huge amounts for spare parts

Benefits offered by Zero Depreciation Add-on Insurance Cover

This add-on cover is not only applicable in the case of amateur drivers but also for experienced drivers. It helps you to reduce the financial burden caused by damages and losses suffered due to accidents. The main benefits are:

• Enhancement of the coverage provided by your basic car insurance and reduction in your expenses to nearly zero
• Management of expenses incurred because of your car’s depreciation cost
• Settlement of claims without deducting depreciation cost

Now that you know a little bit about both consumables and zero depreciation add-on covers, it is best that you opt for zero depreciation insurance with consumables.