Why should you go for a depreciation cover in car insurance?

Mumbai, Maharashtra, India: Zurich Kotak General Insurance, provides insight on why car owners should go for a depreciation cover in car insurance. Many car owners focus on the basic coverage options when it comes to car insurance, such as third-party liability and own damage insurance. However, there’s another important aspect to consider – depreciation cover. This add-on cover feature can provide significant financial benefits in the event of a claim. Let’s explore the importance of depreciation cover in car insurance and why you should consider adding it to your policy.

What is depreciation cover?

Depreciation cover, also known as zero depreciation cover, is an add-on cover that can be purchased along with your comprehensive car insurance policy. The cost of depreciation is deducted from the cost of repairing or replacing the parts at the time of claim settlement. However, with this add-cover, you can enjoy a higher claim payout without considering the depreciation factor for replacing damaged car parts with new ones.

How does depreciation affect your car insurance claim?

When you file a claim for damages to your car in an accident, the insurer will typically consider the depreciation factor while calculating the claim amount. However, with depreciation cover, insurer will cover the entire cost of replacing damaged parts with new ones, regardless of their depreciation value.

Why should you go for a depreciation cover?

There are several reasons why you should prefer adding a depreciation cover along with your car insurance:

• Maximise your claim amount: With a depreciation cover, you’ll get the maximum benefit from your car insurance policy.
• Enhance your financial security: A depreciation cover can provide an added layer of financial security, protecting you from unexpected expenses in the event of a claim.
• Increase your car’s resale value: By maintaining your car’s value through a depreciation cover, you can potentially increase its resale value in the future.

Who should opt for a depreciation cover?

A depreciation cover is ideal for:

• A depreciation cover can help you maintain its value and minimise depreciation losses if you’ve recently purchased a new car.
• If you drive your car frequently, you may be at a higher risk of accidents or damages. A depreciation cover can provide added financial protection in such cases.

The final note 

A depreciation cover is a valuable add-on feature that can save your significant amount of money in the event of a claim. By understanding the importance of depreciation cover and how it can enhance your financial security, you can make an informed decision about adding it to your car insurance.

About Zurich Kotak General Insurance Company (India) Limited (Formerly known as Kotak Mahindra General Insurance Company Limited) 

Zurich Kotak General Insurance Company (India) Limited is a 70:30 joint venture between Zurich Insurance Group and Kotak Mahindra Bank. The Company got its new name ‘’Zurich Kotak General Insurance Company (India) Limited’’ in the month of August 2024, following Zurich Insurance Group’s 70% acquisition in Kotak Mahindra General Insurance Company Limited. It is the youngest and one of the fastest growing non-life insurance franchises in India. 

Kotak General Insurance was established in 2015 to service the growing non-life insurance segment in India. The company aims to cater to a wide range of customer segments & geographies offering an array of non-life insurance products like Motor, Health, Home etc. As a practice, the company seeks to provide a differentiated value proposition through customized products and services leveraging state of art technology and digital infrastructure.