Bumper To Bumper Car Insurance Policy — Coverage & Benefits

The chances are high that you would have come across the
 terms Bumper to Bumper car insurance.
 But what exactly does it mean and what does it cover is a question that not
 many know the answers to. Let’s find out more about a bumper to bumper car

Bumper to bumper car insurance is also known as a Nil
 depreciation or Zero depreciation insurance. This policy leaves out
 depreciation on your vehicle, thereby ensuring a complete cover for your
 insurance policy. In a standard car
policy, when you claim, depreciation of the parts is taken into
 consideration. And you end up paying the additional amount after depreciation
 has been factored in.

In a bumper to bumper insurance, insurers do not deduct any
 form of depreciation from the claims. This is applicable to the entire car,
 excluding the batteries and tyres. It is the responsibility of the insurance
 company to bear the entire cost of parts or repairs.

A bumper to bumper policy offers coverage on metal parts,
 fibre parts and rubber parts. However, it does not offer coverage for engines,
 if there is a leakage of oil or ingress of water. The policy also doesn’t take
 into consideration mechanical breakdowns, consumables or oil changes.

The following people can benefit the most from buying a
 bumper to bumper car insurance.

  • A person who has bought
     a brand new car.
  • A person who is new to
     driving or has minimal experience.
  • Cars that are high end
     in nature and have expensive spare parts.
  • Individuals who live in
     areas that are more prone to accidents.

A Standard Car Insurance Policy

Should you opt for third party insurance, bumper to bumper cover doesn’t
 come into the picture, since the main policy doesn’t cover own damage. In order
 to benefit from a bumper to bumper cover, you need to opt for a comprehensive
 policy. According to the IRDAI, the following depreciation must be deducted
 during repairs.

  • 50% depreciation on
     rubber parts, batteries, plastic or nylon parts.
  • 30% depreciation on
     fibre based glass parts.
  • Standard car
     depreciation on wooden parts. (5% for the first year, 10% for the second year
     and so on).

The Solution Instead of opting for third party insurance only, it is recommended to opt for a comprehensive car insurance policy. Now for the issue mentioned above, i.e. depreciation of different parts of the car, bumper to bumper add-on is the ideal solution. It is more commonly known as the zero depreciation cover. Should you opt for this, the plan
 instantly eliminates any depreciation value on the parts mentioned above.

Take for an example, your hatchback goes to the garage for a
 repair post an accident. And if the workshop provides you with a bill of INR
 35,000, you will end up paying as much as INR 15,000-INR 20,000 due to
 depreciation in spite of having an insurance cover. Having a zero depreciation
 add-on will ensure that you need not pay a such huge sum of money from your

There are a few insurers who also offer roadside assistance,
 towing services, emergency transportation key replacements and so on along with
 the plan. And there is a good reason why the zero depreciation cover policy is
 one of the most bought add-ons for a Car insurance policy. New car owners and
 owners who do not have a lot of experience under their belt, would prefer for
 complete coverage. This cover benefits high-end cars as well.

Before you set out to buy your policy or add-on, a car
 insurance calculator is what you should take a quick look at. The car insurance
 certain basic information from you, such as the vehicle details, previous policy
 details, your area of residence etc. Once you provide all these, it would offer
 quotes accordingly. You can then opt for add-ons and see how that impacts the
 premium and take a final call.

Buying a bumper to bumper insurance
 will offer peace of mind when it’s a high end car, first car or for people with
 relatively lower driving experience.

Originally published at Espreson a Digital Magazine.