Differences Between Zero Depreciation vs Return to Invoice

What is Zero Depreciation Cover?

We all know that as a car gets older and is driven more, its value goes down. This lower value also affects how much money you can claim from insurance if your car is damaged. Normally, when your car is repaired after an accident, the insurance company pays for the repairs but deducts the amount for the parts that have lost value over time (depreciation).

With Zero Depreciation cover, you don’t have to worry about losing money on depreciation. This means you can claim the full repair amount, helping you save on out-of-pocket costs.

Before you buy Zero Depreciation cover, here are a few things to keep in mind:

• It’s available only for cars that are up to ten years old. After that, your car won’t qualify for this cover.
• There might be a limit on how many times you can claim this coverage in a year, depending on your insurance company.
• The premium (cost) for Zero Depreciation cover is higher than a basic comprehensive insurance policy.
• Even with Zero Depreciation coverage, you won’t get 100% coverage. You still need to pay a compulsory amount set by the insurance company.

What is Return to Invoice?

When you buy car insurance, it is mostly based on the Insured Declared Value (IDV), which is the current value of your car. If you have an accident and your car is damaged, a regular insurance policy will only give you the IDV amount. But what if your car is damaged beyond repair, or it's stolen?

The Return to Invoice (RTI) add-on helps you get the full amount you paid for your car (the on-road price), including registration and taxes, in case of theft or total loss. This add-on covers the gap between the current value of your car (IDV) and what you originally paid for it.

Here are a few things to know before buying RTI:

• RTI only works if your car is badly damaged (over 75% of the IDV) or cannot be repaired.
• It is not available for cars older than three years.
• RTI is a good option if you live in a high-risk area where car thefts or accidents are common.
• The cost of RTI is about 10% higher than a basic comprehensive insurance policy.

This cover helps you recover the full purchase price of your car if the worst happens.

Difference Between Zero Depreciation and Return to Invoice

When to Buy Return to Invoice and Zero Depreciation Insurance

Buy Return to Invoice (RTI) insurance if you have an older car or want protection against the difference between the current value of your car and its original price. It’s a good choice if you want to recover more money if your car is stolen or completely damaged.

Buy Zero Depreciation insurance if you have a new car and want to avoid paying for the parts' depreciation when they are repaired or replaced. It’s ideal for new cars, ensuring you get the full cost of repairs without any deductions.

Conclusion

The car insurance protects you financially in case something bad happens to your car. You can get more coverage through various options by adding them to your standard insurance. So both Zero Depreciation and the Return to Invoice have their benefits; it all depends on what you need, or you can even get both for more comprehensive coverage. To avail the best deal, you can compare prices of car insurance online with Square Insurance.