What is Nil Deprecation in car insurance?

 Nil Depreciation is an Add-on feature that is provided by the insurer in the comprehensive insurance policy. An Add-ons are an additional feature that can be opted for by the customer as per the requirement. These are not an actual part of the comprehensive insurance policy.


Nil Depreciation is the feature under a car insurance policy whereby the insurer becomes liable to compensate 100% of the damage caused to the vehicle beyond the IDV value. IDV is the Insured Declared Value of any vehicle, which is derived by the policyholder and insurer. IDV means the exact value of the vehicle in the market. In a normal insurance policy, the insurer deducts the IDV value from the total payable amount and then the bill is passed. But in case of nil deprecation, the insurer will pay for the total amount of the bill.

Factors that are considered in Nil Deprecation

Age of the Vehicle: - The nil deprecation is only offered till 5 years of the vehicle. It means that if the vehicle has more age than 5 years, then the nil deprecation is not applicable for such vehicle. Only the vehicles which are less than 5 years come under the category of nil deprecation.

Premium: - As we opt for this add-on the premium of the policy automatically increases.  The premium of the insurance depends on the type of policy and the add-ons opted for.


Benefits of having Nil Deprecation

Financial Profit: - Nil Deprecation is the car insurance policy under which you are totally free from paying any bills for the repair and replacement of the insured vehicle. This add-on gives you a financial profit, as your bill are not a burden to you.

Hassle-free Drive: - This policy gives you a relaxed and hassle-free drive. You do not have to bother to pay for any calamity that may occur on your vehicle.

Thus, you have come across the benefits of having a Nil depreciation car insurance policy. Therefore, you must consider this add-on in your policy. This can save your time and money after the time of mishappening.

For More Information Visit US:- https://www.quora.com/profile/Shriram-General-Insurance

Location: Ricco Industrial Area, Sitapura, Jaipur, Rajasthan, India

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