At the time of a claim settlement, the policyholder will have to pay a certain part of the insured amount. The amount can be fixed by the insurer or the insured at the time of policy purchase or policy renewal depending on the factor you are bearing. A policyholder will have to cover the following:
|Engine capacity||Compulsory deductible amount|
|Vehicles with up to 1,500 cc engine||Rs.1,000|
|Vehicles with over 1,500 cc engine||Rs.2,000|
In case the vehicle is really old, the insurer can charge a higher compulsory deductible.
Unlike the compulsory deductible, voluntary deductible has an impact on the car insurance premium to be paid. The higher the amount of voluntary deductible one chooses to pay, the lower will be his/her car insurance premium.
The depreciation rates for the car parts/accessories are fixed by the government and is followed by all insures across the country. The depreciation rates are as follows:
The table given below exhibits rates of depreciation on all the other car parts, which includes the wooden parts as well:
|Age of Vehicle||Rate of Depreciation|
|Below 6 months||0%|
|Above 6 months but less than a year||5%|
|1 year - 2 years||10%|
|2 years -3 years||15%|
|3 years - 4 years||25%|
|4 years -5 years||35%|
|5 years -10 years||40%|
|More than 10 years||50%|
Some of the above can be mitigated by opting for appropriate add-on covers such as Zero Depreciation cover, Roadside assistance cover, Return-to-invoice cover, etc.
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