Bumper to bumper insurance is also known as nil depreciation or zero depreciation policy. To begin with, it means a car insurance policy in which there is no depreciation from the insurance cover. Yet bumper to bumper insurance excludes some of the things like tires, battery, engine damage in certain conditions, etc. In this case, the insurance company bears all the costs for the replacement of body parts. Generally, the policy provides 100% coverage without any deductions.
Bumper to Bumper Insurance Suitability
The bumper to bumper car policy is more beneficial for the following persons.
- Cars with Expensive Spare Parts
- Expensive Luxury Cars
- New Cars
- Inexperienced Drivers
- People Living in Accident-prone Areas
Best Bumper to Bumper Insurers
The following are some of the top insurers in India.
- Bajaj Allianz General Insurance Company
- Bharti AXA General Insurance Company
- HDFC ERGO General Insurance Company
- National Insurance Company Ltd.
- Reliance General Insurance Company Ltd.
- TATA AIG General Insurance Company Ltd.
- The New India Assurance Company Ltd.
- Oriental Insurance Company Ltd.
- United India Insurance Company
Normal Depreciation to be Deducted
In case there is an accident, the insurance company normally apply the following depreciation deductions.
|Wooden Parts||As per the year of car (5% 1st year, 10% 2nd year, etc.|
|Fiber Glass Components||30%|
|Rubber, Nylon, Plastic Parts||50%|
Bumper to Bumper Insurance Benefits
1. Zero Depreciation
Bumper to bumper policy is beneficial to the owners as there is no depreciation. As a result, they can claim full compensation for damages and losses. The claim amount is always higher than the premium. In simple words, the owner is paying a high amount early for future costs. Thus, in the nil depreciation policy, the car owners are on a safer side.
2. Greater Coverage
The coverage areas of zero depreciation policy are wider than other policies. Furthermore, it consists of almost everything except a few parts and components.
Bumper to Bumper Policy Exceptions
1. Limit on Number of Claims
Bumper to Bumper insurance has some limitations in a year or later. It is normally twice a year. Besides this, claim limits are clearly mentioned in your policy. Although the owner may claim many times, yet it may vary from company to company.
2. Compulsory Deductibles
There are some compulsory deductibles in every type of insurance policy. It doesn’t matter either it is bumper to bumper or comprehensive policy. Therefore, you should be known to these exceptions at the time of buying the policy.
3. Other Exclusions
The policy may not cover certain damages. They include damage to the engine due to oil leakage, normal wear, and tear, gas kits. Next, it also does not cover some mechanical breakdowns, no claim after five years, etc.
Caps on Policy Claims
The following are some of the limitations of policy claims.
- If the private vehicle is used for commercial purposes
- Driving vehicle sans valid driving license
- If the driver is involved in drunk driving
- To drive a car or vehicle in an illegal way
Thus, the bumper to bumper insurance policy covers the entire costs with some exclusions. Because it works like a comprehension insurance policy with minor differences. Generally, the zero depreciation policy requires renewal every year for the continuation. Above all, always drivers with traffic rules and regulations.