How to Shield Your Car Against Depreciation with Comprehensive Car Insurance?

Cars are no longer a luxury but instead a part of your daily lives. Be it commute to work or for a family outing, it helps to travel with comfort without having to worry about transportation facility. In addition, to registration and PUC certificate requirement, you also need to have a car insurance policy. This insurance cover helps safeguard against financial losses that may arise due to a collision or an accident.

Comprehensive Car Insurance

Car insurance is available in two types – a third-party policy or a comprehensive cover. As the name suggests, a third-party plan covers any legal liabilities that are payable to a third person only. With such a limited scope for third-party cover, a comprehensive car insurance policy is the choice of many since it offers coverage for damages to your car too. However, one limitation of a comprehensive plan is that it does not consider time and thus lowers the compensation at the time of claim. This is due to depreciation and is a result of time.

Like all machineries wear out over time, your car is also prone to depreciation. This percentage of depreciation depends on the time passed and thus lowering the claim paid after each passing year. This impact of depreciation can be avoided using a depreciation shield. Let’s learn more about it.

How to shield your car against depreciation?

Depreciation is that which lowers the amount of pay-out to your comprehensive insurance policy. However, with the help of add-ons this impact of depreciation can be avoided. Add-ons are additional features that are available as an optional upgrade to your comprehensive cover. Since it is an optional feature, it impacts the car insurance prices. With a zero-depreciation cover, you can ensure maximum pay-out for the cost of repairs for your car. The impact of any depreciation on your car is eliminated using such additional facility.

Important pointers about zero depreciation cover

These are some pointers you need to know when buying a zero-depreciation add-on.

  • This add-on is also popularly known as nil depreciation cover or bumper to bumper insurance. The nomenclatures are interchangeable based on the insurance company.
  • Since it an additional feature available on voluntary basis, it increases the premiums of your policy. Despite its costs, the benefits it offers are more and thus buying one is worthwhile.
  • Insurance companies may place a limit on how many times a claim can be raised under this add-on. You need to clarify this beforehand at the time of purchase or car insurance renewal online.
  • The coverage of the zero-deprecation policy is limited to car that are not older than five years.

Who should consider buying one?

Since it increases the claim pay-out of your policy, this add-on is suitable to not one but many different types of drivers. For instance, you own a luxury car, any damages can burn a hole in your wallet. At such time, a zero-depreciation plan ensures the maximum coverage for these damages. Next, new or inexperienced drivers must invest in this policy since accidents are bound to happen when learning to drive a car.

These are some advantages of a zero-depreciation cover that shields your car against the impact of depreciation. Not only does it help to enhance the policy scope, but also lowers the out-of-pocket expenses since most of it covered by the insurance cover. Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms and conditions, please read sales brochure/policy wording carefully before concluding a sale.


Writer. Extreme twitter advocate. Hipster-friendly food expert. Internet aficionado. Earned praised for my work analyzing Yugos for the government. Spent 2002-2008 short selling glucose with no outside help. Spent several months developing strategies for xylophones in Ocean City, NJ. What gets me going now is supervising the production of cod in Cuba. Spoke at an international conference about supervising the production of inflatable dolls in Hanford, CA. Spent two years short selling cabbage in Tampa, FL.