Bajaj Allianz is one of the leading insurance companies in the nation, and offers a comprehensive car insurance policy. The add-on covers offered by this policy are also quite innovative and helpful.

Cars are a depreciating asset. With more usage over a period of time its wear and tear in leads to a decrease in the value of the car (owing to continuous use) and is termed as depreciation.

Similarly, irrespective of a car being insured or not, depreciation is something that no car can escape. For insured cars, depreciation has an effect on the claim settlements with the insurance company.

The Meaning of Bajaj Allianz Zero Depreciation Cover

• By paying an extra/higher premium, you can enjoy zero depreciation an additional benefit (add-on).
• Usually a standard/basic car insurance policy doesn’t include zero depreciation.
• During insurance claims, an insurer always calculates and applies the depreciation rate to arrive at the amount payable (with reference to the damaged part of the car) for settling the claim.
• The difference in cost between the market price of the new part and depreciated part needs to be shelled out by the insured/car owner.
• During settling a claim, insurance companies cover the entire cost without counting in the vehicle’s depreciation, when you have the zero depreciation add-on.
• Zero deprecation ensures hassle free claim settlement in the process and peace of mind.
• For a brand new car, buying this add-on is definitely a worthwhile investment as long as paying the additional premium doesn’t cross your budget.

Bajaj Allianz Car Insurance Depreciation Rates

Depreciation rates considered differ from one insurance company to another, but there are some standard policies that every company follows. Some parts of the car age faster than the others making the depreciation value is higher for those will age faster. Depending on these factors, the insurer applies different depreciation rates for different parts of the car.

• Rubber/plastic parts, tyres/tubes, battery etc. are susceptible to maximum amount of wear and tear.
• Hence, the depreciation rates applied on them are usually higher compared to other parts like fibre glass, etc.
• The depreciation of metallic parts are based on the age of the vehicle.

These include:

• A 50% depreciation rate is applied for parts which have high wear and tear such as rubber/plastic parts, tyres/tubes, battery etc.
• There is 30% depreciation on fiber glass parts.
Metallic parts, are depreciated at 0-50% depending on the age of the vehicle (from
• 0% upto 6 months and going upto 50% after 10 years)
• Painting results in a 50% depreciation of the material cost

Some Important Aspects on Bajaj Allianz Depreciation Rates

Applicable only on new cars

Usually, only new cars can avail the zero depreciation add-on. A certain age limit is given by the insurer, with regards to the same. If your car is older than the specified limit, it is not eligible to enjoy this add-on.

Compulsory Excess

The coverage offered is not 100%, always. Some insurers don’t cover normal wear and tear and mechanical breakdown under this add-on. Every customer who has taken a zero depreciation has to pay a mandatory policy excess. This is known as compulsory excess.

Restriction on Number of Claims

A zero depreciation add-on cover may limit the number of claims that can be made annually. Again, this may vary from one insurance company to another.

Your car is vulnerable to a lot of threats, damages and unforeseen circumstances. A comprehensive car insurance policy protects your car from every possible danger. Strengthen this protection by choosing from a wide range of add-on covers. Give your vehicle the attention and care it deserves by choosing the right car insurance policy and add-on covers.

GST Update: GST of 18% is applicable on car insurance effective from the 1st of July, 2017