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-   -   Is a Zero Depreciation add-on really necessary in the 1st year? (https://www.team-bhp.com/forum/indian-car-loans-insurance/270679-zero-depreciation-add-really-necessary-1st-year.html)

Hello everyone. While I believe a zero depreciation add-on is absolutely essential considering the soaring cost of vehicles & spares, is it really required when purchasing a new car? What if we omit it at the time of purchase and then include it from the 2nd year onwards? Appreciate your thoughts and insights.

It's a personal choice and totally upto an individual. Just curious why you are okay for this second year but not first year?
In a new vehicle, specially if you are moving to an suv from sedan or just moving to a larger vehicle, manual to auto or other way and similar changes, chances of having an incident are highest in first year. I would recommend to go for it for peace of mind with the new vehicle.

A zero-depreciation add-on is costing me ₹15K on a new ₹10L vehicle. Considering that the standard depreciation is 5% for the 1st 6 months and 15% for the next 6 months, it would take a rather large accident repair bill to offset the cost of the add-on cover, in which case the probability of a total loss is also high. Most of the time, the minor fender benders would be covered by the standard insurance policy. This is just my hypothesis, please correct me if I'm wrong.

15k on 10L vehicle sounds too high. From what I remember, it was less than 7.5k for a 20L vehicle when I got a quotation. Cross check with different insurance companies.

I can tell you first hand that it cost me around 7-8k for my new Safari. So, the price being quoted to you is too high unless there are other riders included such as return to invoice, engine protection etc clubbed together. Do look at the details and decide.

You don't know the cost of the part until it has been damaged.
Most companies inflate the bill for insurance companies to pay.
Guess how much the insurance paid to the company for this damage on my elantra.


I paid 2000rs and the insurance paid 60000rs. The front grill costed 30k plus taxes.
So it's better to take most of the add ons that you can.

The Zero dep add on is a mandatory add any new car buyer should include in their Insurance premium. Although its voluntary its highly recommended. No two thoughts about it.

15k cost of the zero dep add on - which Insurance co is this quoting such an astronomical price. I have paid 6.5k as add on on a 18L vehicle and is dependent on the IDV for the policy year. As IDV reduced the cost of the add ons also reduce.

The vehicle depreciation for the first year is 5% and then for subsequent years is 10%, suggest to check the policy document where the depreciation rates are clearly mentioned. Your understanding on the depreciation rates seemed to be mismatched with the policy document.

The depreciation is not about depreciated value of the car. Insurance companies in a very unethical practice knock off 50% on plastic & glass parts which pretty much consists of close to 100% of the parts required in a frontal collision.

It's the quote I've got from the dealership while booking my Ertiga. ₹22K comprehensive or ₹37K with zero dep

Dealerships offer extremely inflated quotes for Insurance. I was quoted 1.67L Comprehensive Insurance +23k if I wanted Zero Dep for the Volkswagen Tiguan I just booked.
I was able to get an All Cover, which is Zero Dep with everything in between all the way to RTI, for 88k Tata AIG via external agent.

You are allowed to get your own insurance from outside. Just make sure cashless is offered at your future service center and proceed.

In Indian road conditions, we cannot expect everyone can have good driving sense. Nowadays a couple of honk behind a 2 wheeler invites road rage and cause damage.

So I would recommend to go with zero depreciation add on. Also the amount quoted with your dealership is high. Try comparing insurance online and you can always negotiate with your dealer. Congratulations for your new vehicle. :)

Renewed my insurance for City CVT for 2nd year yesterday. Zero Depc, Engine Protection, Return to Invoice, they charged me 10k from Universal Sampoo.

Taking the zero-dep add-on is purely optional, but highly recommended.

It would be best not to rely only on the dealer for the insurance. Please check with other sources such as online portals (e.g.: Policy Bazaar) or insurance agents. There is absolutely no requirement that you have to purchase the insurance from the dealer.

Quoting myself from an earlier post:

Zero Dep is optional however one should always go for zero Dep as long as it's available. Few insurance companies offer zero dep till 7 years of the car age.

Useful for the ones who prefer to get the repairs done by authorized body shops (i.e. the dealership)

However, if you prefer to get the repairs done at the local body shops you would end up saving a lot.

Sorry, but am not an expert here.

I have comprehensive insurance for my Alto (5 years) and zero dep for Alcazar (3 months) and Tigor EV (1.3 years).

For Alto, I prefer to get the denting/painting done by the local garages, if needed.

I've got no choice here. The dealer agreed to book the Pearl Midnight Black Limited Edition variant on the condition that I will purchase insurance & accessories from them.

Also, just to clarify: I'm all for zero depreciation and it's definitely on the cards from the 2nd year onwards. My question relates only to the 1st year: with depreciation varying from 5% to 15%, wouldn't the standard comprehensive policy cover most of the damages?