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Zero Depreciation Bike Insurance

05 June, 2019



The Motor Vehicles Act, 1988 introduced two-wheeler insurance in India. This insurance segment is regulated by the Insurance and Regulatory Development Authority of India (IRDAI). Two-wheeler insurance protects your bike against damage, loss, theft, and covers any damages caused to a third party by the insured vehicle. It also provides owner-driver insurance th at pays reimbursement in case of severe injury or death of the owner.


With the advent of digitization, it has become easier to buy insurance policies online. Bike insurance policies can be purchased or renewed online through the official website of the insurance provider or other third-party websites that provide the services. These websites allow you to compare the features and prices of the insurance policies of different insurance companies and buy the one that best suits your requirements.


Bike insurance in India is of two types based on the nature and extent of coverage provided by it.


  1. Comprehensive two-wheeler Insurance – insures the vehicle, the owner-driver and covers damages to third parties.
  2. Third-party two wheeler insurance – only covers the damages caused to a third party.




Let us imagine an insured two-wheeler meets with an accident. Fortunately, there are no injuries to the owner-driver or third-party. However, the vehicle suffers considerable damage; there are dents, the paint has been scratched, and some of the accessories have broken with a lot of internal damage. The owner-driver is assured that he has a comprehensive insurance cover that will reimburse the expenses incurred on losses. However, on raising the claim, he finds out that the company is not compensating the whole amount and he has to bear a specific portion of the cost. This is the result of not opting for Zero-Depreciation add-on while purchasing the bike insurance. So what is Zero-depreciation cover?


To understand this, we need to first look at the meaning of DEPRECIATION.


Depreciation is the reduction in the value of a commodity over the course of its usage due to age, wear and tear, etc. For example, if you purchased a two-wheeler for Rs. 70,000/- and its value now is Rs. 40,000/-, then the value of your vehicle has depreciated by Rs. 30,000/-.


In the example mentioned above, the insurance company reimbursed the expenditure as per the depreciated value of the damaged bike components. The owner-driver had to bear the difference which can sometimes go up to thousands of rupees.


Therefore, Zero-Depreciation Bike insurance is an add-on that insulates the policyholder against the vagaries of depreciation. It provides comprehensive cover to your two-wheeler without considering the depreciation amount. So, when you file a claim, the entire amount of the expenditure due to losses is reimbursed to you without deducting the depreciation. As the depreciation amount is based on the age of the bike, zero-depreciation add-on ensures complete reimbursement of claim irrespective of the age of the vehicle.




  1. Zero depreciation is an add-on that you buy in addition to your base policy. Multiple factors determine the additional premium for zero-depreciation insurance. The age of your bike, the make, and model of the motorcycle, the registration city, city of residence, etc. all affect the zero-depreciation insurance premium. This add-on can be bought until the particular age of your two-wheeler. Kindly check with your insurance provider about the vehicle age limit to avail this insurance.
  2. It can be bought with both new and renewal two-wheeler insurance policies.
  3. There are limitations on the number of claims under this policy, which varies from company to company. Kindly read the terms of your insurance company.
  4. The normal wear and tear, mechanical breakdown and regular maintenance are excluded from the zero-depreciation cover. The cover is extended only to insured components.
  5. It offers coverage on all fiberglass, plastic, nylon and rubber components of the bike.




While being a comprehensive insurance cover for two-wheelers, zero depreciation insurance protects the owner-driver from spending thousands as expenses for losses. As it eliminates the factor of depreciation while calculating the reimbursement, the owner-driver is assured of 100% claim benefit.