Comprehensive vs Zero Depreciation Insurance

Know the difference between comprehensive insurance and zero depreciation insurance.
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Comprehensive vs Zero Depreciation Insurance
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3 min
25-July-2023

Choosing the right insurance policy for your car is crucial. The two most popular policies for car insurance in India are comprehensive insurance and zero depreciation insurance. These two policies come with different features and benefits. In this article, we will discuss the difference between comprehensive and zero depreciation insurance policies, helping you make an informed decision.

What is comprehensive insurance?

Comprehensive insurance coverage provides complete protection for your car from any damage that might be incurred due to accidents, natural disasters, or theft. This policy covers damages caused to your car, third-party vehicles, and property. Comprehensive insurance policies also offer coverage against personal accidents.

What is zero depreciation insurance?

Zero depreciation insurance, also known as 'bumper-to-bumper' insurance, is an add-on to the comprehensive insurance policy. This policy offers complete coverage in case of an accident. It is a policy that ensures complete indemnity in case of accidental damage to the car. Under this policy, the insurer pays the full cost of repairs or replacement without any depreciation.

Comprehensive insurance vs zero depreciation insurance

The table below provides a comparison of comprehensive vs zero dep insurance policies.

Features

Comprehensive car insurance

Zero depreciation insurance

Coverage

Covers damage to the car, third-party vehicle, and property.

Comprehensive coverage, along with no depreciation on parts.

Premium

Lower premium compared to zero depreciation.

Higher premium compared to comprehensive.

Claim settlement

Depreciation is considered while settling the claim.

No depreciation is considered – 100% claim settlement.

Age of vehicle

Available for all ages of vehicles.

Only available for new cars (less than 5 years old).

Add-ons

Add-ons are available for specific coverage.

Fewer add-ons are available.


Which one is better – Comprehensive or zero depreciation insurance?

This entirely depends on an individual’s requirements. While a comprehensive policy covers a wide range of damages such as natural disasters, theft, and third-party damage, a zero-depreciation policy does not account for any depreciation, providing complete coverage for new car owners.

If you live in a low-risk area and own an older car, then a comprehensive policy might be cost-effective for you. However, if you are a new car owner or live in an area prone to natural disasters, then zero depreciation insurance might be better for you.

Choosing the right motor insurance policy can be a challenging decision for Indian car owners. Understanding the difference between comprehensive and zero depreciation insurance policies can help them make an informed choice. Comprehensive insurance policies have a broader coverage scope, offering protection against a range of risks that can cause damage to the vehicle, such as accidents, theft, vandalism, or natural calamities. However, they also come with a deductible and depreciation clause that can depreciate the value of the insurance claim.

On the other hand, zero depreciation policies cover the full value of the damaged parts without any depreciation. They provide more comprehensive coverage, but their premium is typically higher than traditional insurance policies. Car owners should evaluate their options carefully, consider their vehicle's age, model, and usage, and choose the policy that best meets their needs and budget. Regardless of the choice, car owners must drive safely and responsibly to minimise the risks and benefits of their auto insurance policy.

Frequently asked questions

Is comprehensive insurance the same as zero depreciation?

No, comprehensive insurance and zero depreciation insurance are not the same. Comprehensive insurance covers damages caused by theft, natural disasters, vandalism, and other unforeseen events. Zero depreciation is an additional cover that provides full coverage without any deduction of depreciation on the value of the car or bike's parts.

What is the difference between comprehensive third-party and zero dep insurance?

Comprehensive insurance covers damage to your own vehicle, damages to third-party vehicles and property. It also provides coverage for natural disasters and thefts. Third-party insurance only covers damages caused to the third-party vehicles or property but doesn't provide coverage for your own vehicle. Zero depreciation, on the other hand, is an additional cover to the comprehensive policy, which covers damages to your own vehicle without any deduction for depreciation.

What is the difference between zero dep and comprehensive insurance for bike?

The key difference between zero depreciation and comprehensive insurance for a bike is that zero depreciation insurance provides coverage for damages to the vehicle without any deduction of depreciation while comprehensive insurance covers damages to your vehicle caused by accidents, theft, natural calamities, after accounting for depreciation of parts in the bike's value.

Disclaimer

Insurance is the subject matter of solicitation. *T&C Apply - Bajaj Finance Limited (‘BFL’) is a registered corporate agent of third-party insurance products of Bajaj Allianz Life Insurance Company Limited, HDFC Life Insurance Company Limited, Future Generali Life Insurance Company Limited, Bajaj Allianz General Insurance Company Limited, SBI General Insurance Company Limited, ACKO General Insurance Limited, ICICI Lombard General Insurance Company Limited, HDFC ERGO General Insurance Company Limited, Tata AIG General Insurance Company Limited, Niva Bupa Health Insurance Company Limited , Aditya Birla Health Insurance Company Limited, Manipal Cigna Health Insurance Company Limited and Care Health Insurance Company Limited under the IRDAI composite CA registration number CA0101. Please note that, BFL does not underwrite the risk or act as an insurer. Your purchase of an insurance product is purely on a voluntary basis after your exercise of an independent due diligence on the suitability, viability of any insurance product. Any decision to purchase insurance product is solely at your own risk and responsibility and BFL shall not be liable for any loss or damage that any person may suffer, whether directly or indirectly. Please refer insurer's website for Policy Wordings. For more details on risk factors, terms and conditions and exclusions please read the product sales brochure carefully before concluding a sale. Tax benefits applicable if any, will be as per the prevailing tax laws. Tax laws are subject to change. Tax laws are subject to change. BFL does NOT provide Tax/Investment advisory services. Please consult your advisors before proceeding to purchase an insurance product. Visitors are hereby informed that their information submitted on the website may also be shared with insurers. BFL is also a distributor of other third-party products from Assistance Services providers such as CPP Assistance Services Pvt. Ltd., Bajaj Finserv Health Ltd. etc. All product information such as premium, benefits, exclusions, sum insured, value added services, etc. are authentic and solely based on the information received from the respective insurance company or the respective Assistance service provider company.

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