Safeguarding the value of your car is the primary role of car insurance. But most car buyers don’t put in enough research when opting for car insurance. Getting proper insurance cover for your car is crucial, so as to protect it from any unforeseen circumstances. Liability Cover, Collision Insurance, Comprehensive Insurance, Zero Depreciation Cover are a few options offered by insurance companies. It is important to do your bit of research on what a particular insurance policy covers or doesn’t. Take a Zero Depreciation Insurance Cover as an example, while it would protect you against depreciation, other insurance policies wouldn’t.
What is depreciation?
Depreciation is the difference between a car’s value when you buy it and when you come to sell it. That means, the older a car gets, the lower its resale value. Depreciation depends on a lot of factors like:
Mileage: The more kilometres it travels, the less it’s worth.
Number of owners: If a car gets sold and resold a couple of times, its value decreases.
General condition: Damage to bodywork, interior and exterior will reduce value.
Service history, warranty, fuel economy and desirability are a few more factors that depreciate your car’s value over a period of time. Depreciation is an unavoidable reality with any vehicle.
Car insurance covers losses one might incur if a car is damaged or stolen. But when a car is damaged, you are not entitled to 100% reimbursement of the expense incurred on the parts replaced. This is where depreciation comes into play. This means that the insurance company will only pay the residual value, i.e. the remaining value of the part after deducting depreciation.
Fix this problem with Zero Depreciation Insurance Cover.
Zero Depreciation Insurance Cover ensures complete coverage without considering depreciation costs. So even if your car gets damaged, your insurer will pay out the entire cost. You receive full claim without any deduction for the depreciation on the value of replaced parts. You could either opt for a Zero Depreciation Car Insurance Policy, or you could opt for a Zero Depreciation Cover on your existing policy.
A policy holder gets the following benefits with a Zero Depreciation Add-on:
1. Claim Settlement
Zero Depreciation Add-on covers full cost of repairing irrespective of depreciation. It offers 100% coverage for all fiber, rubber and metal parts.
2. The Car’s Age
If you’ve bought a new car, Zero Depreciation Add-on is definitely for you. The cover is not available to cars beyond five years of age or ones that have clocked more than a certain number of kilometers.
A zero depreciation cover ensures that your car is always in optimal condition. It is cost efficient when it comes to replacing damaged parts of any car, whether luxury or hatchback.
A Zero Depreciation Cover is beneficial to people with new or luxury cars, but it also safeguards new or inexperienced drivers who are prone to get their car damaged.
With a number of options available in the market for car insurance, it might get confusing to pick the best one for you. But fret not; all you need to do is get in touch with captive finance companies such as Volkswagen Financial Services that will ease the process of selecting the appropriate car insurance for you.