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Choosing add-ons for your car insurance is always beneficial. For many new car owners, zero-dep car insurance is a preferred add-on because it reduces out-of-pocket expenses during claims in the early years of ownership.
By removing depreciation deductions on replaced parts, it offers higher claim payouts compared to standard policies. However, this cover does not remain available indefinitely, which often leads to questions about what happens once the vehicle crosses a certain age.
What is Zero Depreciation Car Insurance?
When purchasing car insurance online, zero depreciation cover is offered as an optional add-on to a comprehensive policy. Under this cover, insurers do not deduct depreciation on parts such as plastic, rubber or fibre during claim settlement. This differs from standard comprehensive insurance, where depreciation is applied based on the age and type of parts replaced.
Zero depreciation cover is most beneficial during the initial years of a car’s life, when repair costs are relatively high and part replacement is more frequent.
Validity for Zero Depreciation Cover
Most insurers limit zero depreciation cover to cars that are up to five years old. This restriction exists because, as the vehicle’s age and wear and tear increase, it becomes difficult to assess damage strictly caused by an accident. Older vehicles are also more likely to have repeated repairs, which increases claim frequency and cost for insurers.
The exact age limit may vary slightly depending on the insurer and vehicle type, but five years is the commonly accepted threshold.
What Happens to Zero-Dep Car Insurance After 5 Years
Once a vehicle moves beyond the age limit set for zero depreciation, this cover generally cannot be renewed. Claims after that stage follow standard comprehensive policy terms, where depreciation is applied to the parts being replaced.
In practical terms, this changes the way repair costs are shared, and owners often end up paying a larger portion of the bill at the time of a claim. The percentage of depreciation applied depends on the material of the part and the age of the vehicle, as defined by insurance guidelines.
How Claim Settlement Changes After Zero-Dep Ends
Without zero-dep car insurance, insurers deduct depreciation on parts such as bumpers, panels, tyres and rubber components. While labour costs are often still covered, the reduced payout for parts increases the owner’s contribution.
Understanding this shift helps car owners adjust expectations and plan maintenance costs more realistically as the vehicle ages.
Alternatives to Consider After Zero Depreciation
Once zero depreciation is no longer available, many car owners switch focus to other add-ons that can still improve their cover. Features like engine protection, roadside assistance and return-to-invoice may continue to be offered, based on the car’s condition and the insurer’s policy rules.
Choosing a realistic IDV and maintaining the vehicle properly can also help manage claim outcomes under a standard comprehensive policy.
Is Zero-Dep Car Insurance Worth It For New Cars?
For new and relatively new cars, zero depreciation cover can be cost-effective due to higher claim payouts and reduced owner contribution. However, as the vehicle ages, the relevance of this add-on naturally declines, making it important to reassess coverage needs at each renewal stage.
Enjoy a Wide Range of Add-Ons with TATA AIG Car Insurance
As vehicles move beyond the zero depreciation eligibility period, understanding how coverage changes becomes important. With TATA AIG car insurance, zero depreciation benefits are available only for vehicles that meet the eligibility criteria.
Once a vehicle moves beyond that stage, claims are settled using standard depreciation rules. At that point, car owners usually review their policy and look at other add-ons or coverage adjustments. TATA AIG spells out these options clearly, which makes it easier to continue with suitable coverage even as the vehicle gets older.
Also read: Everything You Need To Know About Vehicle Depreciation Values
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