Buying insurance for a two-wheeler for an average bike or scooter offers enough cover against most risks. But a brand-new expensive sports bike may need additional care. You cannot merely buy bike insurance and expect it to cover the costs that come with owning a beast-like machine like a sports bike. While a standard two-wheeler insurance policy might suffice for wear and tear, a mishap resulting in repair costs, third party injuries, and more can create a big hole in your pocket.
In such cases, a comprehensive insurance policy, with relevant add-ons for a sports bike, can be your saviour. Insurance companies offer different add-on covers to enhance policy coverage, and one of them is called ‘zero depreciation’. While many customers think add-ons are an added expense, you will be surprised to know the advantages they have to offer.
What is a Zero Depreciation Cover?
Unlike fixed assets, such as real estate, a sports bike is a depreciating asset. This means that its value decreases with time. In a standard two-wheeler insurance policy, any repairs or replacements are partially covered by the insurance provider. The depreciation cost is borne by the owner of the bike.
However, in a Zero Depreciation Cover, the insurer covers the full cost of repairs without any deductions for depreciation. Since repairs for sports bikes can cost a lot, this add-on proves to be extremely useful. Unless you have this add-on, insurers will always take the depreciation value into consideration before offering you a suitable compensation.
As time passes, the value of your bike components goes through depreciation and with a standard bike insurance policy, only a part of the repair or replacement costs are covered by the insurer. The Indian Motor Tariff has determined a rate of depreciation for all bike components. These depreciation figures are used by insurers while calculating the final claims.
| Motorcycle Components | Depreciation (in percentage) |
| Nylon, rubber, tyres and tubes, batteries, plastic parts (parts that go through a lot of wear and tear) | 50% |
| Paint | 50% |
| Fibreglass/Glass materials | 30% |
| Other parts made of metal | 0% – 5% |
| Other parts made of glass | Nil |
So, if a claim is raised without the Zero Depreciation Cover, the aforementioned depreciation rates will be applied to respective accessories and parts. But if you have a Zero Depreciation Cover, you will be reimbursed the entire amount!
What are the benefits of a Zero Depreciation Cover?
Here are some advantages that you should know of:
- This add-on, along with a standard bike insurance policy, offers the full claim amount for the value of the parts replaced and the cost incurred on repairs.
- The depreciation factor is not considered while paying out claims under this cover.
- You can avoid the costs of repairs and damages and only pay labour and other minor charges out of your pocket.
- Your mind will be at ease with the add-on, and you can ride your expensive bike with a sense of security and peace of mind.
What are the damages covered by a Zero Depreciation Cover?
A zero-depreciation add-on covers the following:
- Any damage caused to rubber, fiberglass, and nylon and fiber parts is covered under the add-on.
- The policyholder can only make two claims during the policy period.
- This cover can be bought by both new and old two-wheelers. However, the bike cannot be older than five years.
What are the exclusions in a Zero Depreciation Cover?
The Zero Depreciation Cover excludes the following:
- Normal wear and tear related damages.
- Disfigurement or damages caused as a result of mechanical work or breakdowns.
- Damage to uninsured parts such as bi-fuel kit, tires, gas kits, etc.
- If you do not have the add-on cover, you can buy it at the time of renewal. This add-on offers a cover for one year. After that, you must renew it annually to enjoy its benefits.
When can you avail of a Zero Depreciation Cover?
The terms and conditions of Zero Depreciation Cover will differ from insurer to insurer. So, make sure to read them carefully. The tenure of the claim and the premium amount will also vary from company to company. It is extremely important to know the components of the add-on before making a purchase. While these standards differ for most companies, here are a few generally included conditions:
- Zero Depreciation Cover can only be claimed twice during the policy term.
- In case the bike has been in an accident, then the policyholder must get it repaired at the network of garages that have partnered with that particular insurer.
- If the bike is completely damaged or stolen, this benefit cannot be availed.
- Some insurers cover a part of the expenses if your bike is damaged due to public protests or fire.
If you have any questions regarding your cover, make sure to talk to your insurance provider and get clarity so that there is no confusion.
To sum it up
Riding on your sports bike must feel like a dream, but even slight carelessness can lead to a sizeable bill. To avoid this, you must remember to get a Zero Depreciation add-on while buying bike insurance online. Getting this rider along with your bike insurance will save you more money in the long run than paying higher premiums now. Most reputable insurers offer this rider along with other useful provisions that can add value to your bike insurance policy.