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Zero Depreciation vs Bumper to Bumper Car Insurance

By Juhi Walia
16 August 2022, 10:20 AM

Different words used for car insurance products frequently cause confusion among people. This is because many car insurance plans have numerous labels that are interchangeable. One such frequent misunderstanding is the bumper-to-bumper or zero depreciation cover. Bumper to bumper coverage and zero depreciation coverage are interchangeable terms. They are essentially two terms for the same type of car insurance policy add-on that protects a policyholder from the expense of the vehicle's devaluation. Zero depreciation or bumper-to-bumper plans cover the entire replacement cost. Let's read more about the same.

What is Zero Depreciation Car Insurance?

As stated above, bumper-to-bumper car insurance is another common name for zero depreciation car insurance coverage. Bumper-to-bumper car insurance offers coverage for your car in addition to the third party. In contrast, a primary or third-party car insurance policy only insures damages to the third party or their vehicle if an accident occurs. 

Unlike other kinds of car insurance, this kind of insurance covers your car's exterior elements, including its metal body, plastic parts, extra connectors, and selected attachments. In other words, your car is secured (usually including airbags) from the front to the rear bumper. 

As depreciation is covered, this type of insurance is also known as zero depreciation car insurance. In other words, you, the policyholder, are responsible for 0% of the repair costs.

What does Zero Depreciation Car Insurance Cover?

All types of fibre, rubber, plastic and metal parts are completely covered by this car insurance add-on cover, with no deductions for depreciation, except for batteries, tubes and tyres.

What does Zero Depreciation Not Cover?

  • It excludes damage to the engine brought on by water inundation or oil leaks.
  • This policy does not cover mechanical failure.
  • It excludes changing the oil or consumable items.
  • This policy does not cover external fittings, such as gas kits.

Advantages of Zero Depreciation Car Insurance Cover

The various advantages of zero depreciation car insurance are mentioned below:

  • Car drivers can benefit from zero depreciation for car insurance, but even experienced drivers can be covered from the financial burden of losses and damages brought on by accidents.
  • It improves the basic car insurance coverage, cutting your costs almost to zero.
  • It minimizes costs associated with depreciating the insured car's cost considering the current market value.
  • Replacement or repair costs for secured items are covered without considering depreciation.

Read more - How Zero Depreciation Cover is Beneficial for New Cars

Comparing Normal Car Insurance vs Zero Depreciation Car Insurance Cover

The table below demonstrates the fundamental differences between zero depreciation and standard car insurance:

Car AgeDepreciation Rate with No Zero Depreciation CoverageDepreciation Rate with Zero Depreciation Coverage
Under 6 monthsNil0%
6 months to 1 year5%0%
1-2 years10%0%
2-3 years15%0%
3-4 years25%0%
4-5 years35%0%
5-10 years40%0%
Above 10 years50%0%

Things to Consider When Choosing Zero Depreciation Car Insurance Cover

When choosing zero depreciation car insurance, consider the following factors:

  • For insurance with no depreciation add-on, your car should not be older than three-five years.
  • The car's depreciated value is restored on standard zero depreciation car insurance policies.
  • Due to the additional coverage it offers compared to a standard car insurance policy, the zero depreciation cover carries a higher price. Thus, you should only choose it if you have the spare funds.
  • Luxury automobile owners and drivers who live in high-risk areas are advised to purchase zero depreciation car insurance add-on coverage.
  • To reduce the amount of car insurance claims filed for minor problems like dents in the vehicle, claims with zero depreciation car insurance coverage can be filed in certain circumstances.
  • Batteries for cars and automobile components are recoverable for 50% depreciation.
  • The car's age affects the depreciation deduction for wooden auto parts. In general, depreciation values range from 5% in the first year to 10% in the second year.

Who Would Benefit the Most from a Zero Depreciation Cover?

The following individuals would benefit the most from zero depreciation cover:

  • People who buy expensive automobiles.
  • Unskilled or new drivers.
  • People who reside in areas where accidents, calamities, or thefts are more likely to occur.
  • Car owners with a vehicle that has pricey replacement parts.
  • Car owners who worry about the minor dents and scratches on the vehicle.

What Elements Affect the Cost of Zero Depreciation Car Insurance?

Three primary variables determine your zero depreciation car insurance premium:

  • Vehicle's age
  • Vehicle's model
  • The place where you live


In the lack of a zero depreciation or bumper-to-bumper car insurance add-on, the information mentioned above adequately illustrates how much a policyholder loses during the process of a claim settlement. As a result, a zero depreciation car insurance cover is a very cost-effective addition to your car insurance because it allows you to avoid paying the depreciation expense altogether.

Read more -

Benefits of Zero Depreciation Cover During Claim

Even Your Zero Depreciation Cover Doesn’t Ensure Zero Expense


1. Does the car bumper get zero depreciation coverage?

Full-body insurance, also known as bumper-to-bumper coverage, offers complete protection for all metal, rubber, and fibre components without reducing the depreciation value. However, it won't protect against engine damage brought on by water intrusion or oil leaks.

2. What does bumper-to-bumper car insurance not cover fully?

Except for the engine, tyres, batteries, tubes, and glasses, all items are covered fully by the bumper-to-bumper car insurance policy. This car insurance coverage is typically offered in addition to the basic plan.

3. Is paint covered by zero dep car insurance?

You will not be responsible for any depreciation charges for vehicle repairs, such as painting, rubber element replacements, or glass or fibre replacement if you have chosen an add-on cover like zero depreciation, commonly known as nil-dep cover.

4. Is the engine covered by bumper-to-bumper car insurance?

Unfortunately, the bumper-to-bumper car insurance policy does not cover engine damages brought on by fuel or water intrusion. The cost of changing the fuel in the car is also not covered by this insurance coverage.

5. Which is preferable, comprehensive or bumper-to-bumper car insurance?

In any case, you will need to buy a comprehensive car insurance policy to get covered against both third-party and own damage liabilities. A bumper-to-bumper add-on cover will help expand the coverage of your comprehensive policy.

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