What is IDV in Car Insurance?
IDV is the maximum amount your insurance
provider pays you, in case your car is stolen or totally damaged.
The Insured Declared Value and your car
insurance premium goes hand in hand. Which means, the higher your IDV is, the
higher your car insurance premium will be and as your vehicle ages and IDV
depreciates, your premium also decreases.
When you decide to sell your car, a higher IDV
means you will get a higher price for your car. Price also gets affected by
other factors like usage, past car insurance claims experience and so on.
So, when you choose the car insurance policy
for your car, remember to make note of the IDV being offered, and not just the
premium.
A company offering a low premium may be because
the IDV on offer is low. In case of total loss of your car, a higher IDV will
lead to higher compensation.
At the time of resale, your IDV will indicate
the market value for your car. However, if you have maintained your car well
and is looking as good as new, you can always opt for a price more than what
your IDV might offer you.
What is No Claim Bonus or NCB in Car
Insurance?
NCB or No Claim Bonus is the discount on
premium given to the policyholder for having a claim free policy term
A no claims bonus ranges between 20-50%
discounts which you will earn at the end of your policy period by maintaining a
record of making no car accident claims under your car insurance policy.
A no claims bonus it something you cannot buy
in your first comprehensive car insurance policy. You can only get it on your
policy renewal. Your no claims bonus increases after every claim-free year of
your policy renewal.
You can earn a 20% NCB after the first year of
having no claim under your car insurance policy. This percentage will increase
with every claim-free year, reaching 50% after 5 years and resetting to zero
when you make a claim.
After reaching 50% in the 5th year, your NCB
stops rising and remains the same. This is called the No Claim Bonus Sunset
Clause
A No Claim Bonus is meant for the car
insurance policyholder regardless of the car. Which means, even if you change
your car, your NCB stays with you.
If you wish to buy a new car, you will be
issued a new car insurance policy, but you can still avail of the NCB you
accumulated on the old car or policy.
Zero Depreciation Cover in Car
Insurance
A Bumper-bumper or Zero depreciation
cover or Parts Depreciation Cover, makes sense for cars less than 5 years old.
There is a decrease in value of certain parts of your car, including the bumper
or any other metal or fibre glass parts.
So, when a damage happens, the full cost of
replacement is not given as depreciation is deducted from the claim
money. But this add-on makes sure there is Zero Depreciation and you get the
full value of the cost of repair/replacement provided.
In short, if your car is partially damaged,
you don’t have to bear the amount being calculated for depreciation and your
insurer will take care of everything
What is Cashless Claim in Car
Insurance?
If you opt to get your car repaired with an
Insurance Authorized Repair Center, then they will make the payment for the approved
claim amount, directly to the Repair Center. This is a Cashless Claim.
Please note, if there are any deductibles,
like a Compulsory Excess/ Deductible, any repair charges for which you’re
insurance doesn’t cover you or any depreciation costs that is to be paid from
your own pocket.
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