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Common Misconceptions About Zero Depreciation in Two-wheeler Insurance

By Juhi Walia
03 August 2022, 5:44 PM

A zero depreciation cover is an add-on coverage that can be availed over and above comprehensive two-wheeler insurance or on a standalone one-damage two-wheeler insurance online as well as offline. It is highly beneficial and handy for protecting you from substantial financial losses while raising a bike insurance claim. However, many misconceptions regarding this facility need to be understood and unveiled to avail optimum benefits from it. So, what are they, and do you have such misconceptions regarding zero depreciation bike insurance add on cover? Let's read on and stay clear of these.

What is Zero Depreciation Cover?

With time, every mechanical asset suffers wear and tear. This leads to depreciation and a decrease in the value of the asset. The same rule applies to your vehicle, whether a car or a two-wheeler. The regular decrease in the value of your two-wheeler affects the coverage of your two-wheeler insurance policy

When claiming, you get an amount after standard deductions and the calculated depreciation value. It is here that the zero-depreciation cover comes as a saviour. You can save on this depreciation value, and you get the maximum settlement claim amount, as it excludes the depreciated value of your vehicle. This way, you are saved from paying the difference amount of depreciation from your pocket. 

However, there are many myths attached to an add-on zero depreciation cover. Let us take it up one by one.

Misconceptions Regarding Zero Depreciation in Two-wheeler Insurance

Myth- Zero Depreciation Cover is Available Only for Car Insurance Buyers

Fact- Zero depreciation policy is also available for two-wheeler insurance online as well as offline.

Myth- Insurers Accept Multiple Zero Depreciation Claims

Fact- Bike insurance companies limit the times you can file a claim with the zero depreciation cover during the policy period. Most insurers allow you to file this claim only twice during the policy period. The primary reason for this is with the zero depreciation policy, insurance companies are subject to higher risks and want to limit their liabilities. 

Myth- Zero Depreciation Add-on Covers All Wear and Tear

Fact- Zero depreciation excludes general wear and tear. The exclusions include:

  • Mechanical slip-up damages.
  • General wear and tear.
  • Total loss of the vehicle due to incidents such as theft.
  • Damage caused to uninsured parts like gas kits, tyres, etc.
  • Water ingression or oil leakage that causes engine damage.

Myth- Zero Depreciation Cover Frees You from Compulsory Deductibles

Fact- compulsory deductible refers to the amount you are liable to pay as a bike insurance policyholder. However, with zero depreciation also, you would have to pay this amount to the insurance company. 

Myth- Zero Depreciation Covers Consumable Costs

Fact- When repairing a bike or a two-wheeler, a garage uses various consumables like nuts, bolts, oil, etc. These costs are not covered under the zero depreciation cover unless you have a separate consumables add-on for the policy. 

Myth- Zero Depreciation Available for Old Bikes

Fact- If your vehicle is six years old or above and you want to opt for a zero depreciation add-on to your two-wheeler insurance policy, the insurer will likely deny you this add-on. Most insurance companies do not offer this facility for vehicles older than five years. 

Who Should Go in for a Zero Depreciation Add-on Policy?

Zero depreciation policies are best for the following people and situations-

  • Someone possessing luxury bikes with expensive spare parts.
  • If your two-wheeler is around 2-3 years old.
  • If you do not want to pay hefty garage bills for repairs and replacements while claiming.
  • Traverse regularly on the area or travel route which is accident prone.
  • For new bikes or amateur riders.

What Percentage Would an Insurer Pay in Case of Repair and Replacement When Claiming?

In case of repairs and replacements of a bike claim, an insurer would be liable to pay the following:

Depreciable Bike PartsDepreciated Cost (% of total cost)
Rubber, Nylon, Plastic50%
Tyre(s) and Tube(s)50%

What is the Difference Between a Comprehensive Bike Insurance Policy with and without a Zero Depreciation Add-on Cover?

The difference between a comprehensive bike insurance policy with and without a zero depreciation add-on cover is:

Differentiating PointsComprehensive Policy with Zero DepreciationComprehensive Policy without Zero Depreciation
Claim AmountFull payment of garage bills is allowed under this policy. The insurer deducts depreciation before deciding the claim amount.
Cost of Depreciable PartsFull paymentPartially paid
Premiums CostComparatively higherComparatively lower than with a zero dep add-on cover.
Savings at the time of claims ensuresIt ensures savings on the repair/replacement cost of depreciable parts.Need to pay depreciable costs depending on the type of depreciable material.

What Other Add-on Covers Can You Add to Your Two-wheeler Insurance Policy?

Apart from the zero depreciation add-on, you can add the following add-ons to their existing two-wheeler insurance policy if you feel they fulfill your needs. 

  • Return to invoice cover
  • NCB protection cover
  • Engine protection cover
  • Roadside assistance cover
  • Consumables cover
  • Tyre protection cover

Final Take

A zero depreciation add-on policy saves you from extra expenses when claiming damages and repairs for your bike. Even though the premium may be slightly higher when taking an add-on zero depreciation for your two-wheeler insurance, it saves you from paying massively during mishaps and unforeseen incidents.

With an add-on zero depreciation policy, the insured gets full coverage of repair/replacement of the depreciable parts. The insurer compensates for full garage repair bills at the time of claim, giving you complete peace of mind. 

Read more -

Which is Better: Comprehensive or Zero Dep Two Wheeler Insurance Policy


1. What is not covered under a zero depreciation policy?

A zero depreciation policy does not cover engine damage due to water ingression or oil leakage. Also, this policy does not cover any mechanical breakdown, oil change or consumables.

2. Can I get a zero depreciation policy for a 10-year-old bike?

No, a zero depreciation policy cannot be availed on a 10-year-old bike.

3. Is zero depreciation cover worth buying for your bike insurance policy?

Yes, zero depreciation is a good deal as it covers damages and losses from repairs. 

4. Is zero depreciation the same as bumper-to-bumper?

Yes, zero depreciation and bumper-to-bumper are the same.

5. Does zero depreciation cover damage due to wear and tear?

No, zero depreciation does not cover regular wear and tear on your bike insurance policy. 

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