Car ownership brings the joy of independence and comfort, but it also comes with the responsibility of protecting your vehicle from unexpected damages and financial losses. One of the most reliable ways to do that is through bumper-to-bumper insurance, commonly known as zero depreciation cover. This add-on ensures you don’t have to bear the cost of depreciation during claims, offering near-total coverage for repairs or part replacements.
Insurers like Tata AIG offer this feature under its Depreciation Reimbursement Add-on, available with comprehensive car insurance policies. With a car garage count of 5,900 across India, Tata AIG enables quick and hassle-free cashless repairs. Combined with digital policy management and strong claim support, it provides a convenient and comprehensive solution for vehicle protection.
What Is Bumper-to-bumper Insurance?
Bumper-to-bumper insurance, also known as zero depreciation cover, is an add-on available with comprehensive car insurance. It ensures that no depreciation is deducted from the claim amount during repairs or part replacements.
Under standard motor insurance, claims are settled after factoring in the depreciated value of the damaged parts, meaning the policyholder bears a portion of the repair cost. However, with bumper-to-bumper coverage, this deduction is waived for most parts, such as plastic, rubber, metal, and fibre components.
In the event of an accident or damage, the insurer covers the full cost of repairs or replacement of eligible parts, excluding only a few specific exclusions. As a result, the policyholder’s out-of-pocket expenses are significantly reduced, making it a valuable option for new or high-value vehicles.
How Bumper-to-bumper Insurance Works
Typically, in a regular comprehensive car insurance policy, depreciation is applied as follows:
- Plastic, rubber, and nylon parts – 50%
- Fibreglass components – 30%
- Glass parts – Nil
- Paint – 50% depreciation on material cost
- Metal and other parts – As per the age of the vehicle, ranging from 5% to 50
Without bumper-to-bumper coverage, these depreciated amounts are deducted from the claim payout, leaving the insured to bear the difference. However, with the bumper-to-bumper add-on, the insurer bears the entire cost of repair or replacement for all covered parts, irrespective of depreciation, making it especially beneficial during large claims.
What’s Covered Under Bumper-to-Bumper Insurance?
Bumper-to-bumper insurance typically provides extensive coverage that includes:
1. Repair or Replacement of Most Car Parts Without Depreciation
The add-on nullifies depreciation on most vehicle components, like:
- Plastic parts
- Rubber parts
- Fibre parts
- Metal components
- Engine components (if part of an admissible claim)
- Painted surfaces
This means the policyholder does not have to pay from their pocket for these replaced or repaired parts, except for the mandatory deductibles mentioned in the base policy.
2. Coverage for Accidental Damage
If the car suffers damage due to an accident, the full cost of repair—excluding specified exceptions—is borne by the insurer, including the replaced parts and labour charges, as long as the claim is admissible under the own damage section.
3. Protection During Natural Calamities
When a car is damaged due to events like floods, earthquakes, cyclones, or landslides, Bumper-to-bumper coverage ensures the policyholder doesn’t incur depreciation-related costs during claim settlement.
4. Benefits of Cashless Repairs
If repairs are carried out at the insurer’s authorized garage network, the settlement is processed as a cashless transaction with zero deduction for depreciation on parts.
5. Limited Number of Claims Per Policy Term
In most cases, Bumper-to-bumper insurance allows a certain number of claims per policy year (e.g., two claims), after which regular depreciation rules may apply unless specified otherwise in the policy schedule.
What’s Not Covered Under Bumper-to-bumper Insurance?
While Bumper-to-bumper insurance offers extensive coverage, it comes with defined exclusions and conditions:
1. Not Applicable to Tyres and Batteries by Default
Unless a separate tyre and battery depreciation allowance add-on is purchased, damages to tyres and batteries are subject to standard depreciation (e.g., up to 50%).
2. Not Valid for Total Loss or Theft
If the vehicle is declared a total loss, constructive total loss (CTL), or is stolen, Bumper-to-bumper coverage does not apply. In such cases, the Insured Declared Value (IDV) becomes the claim amount basis.
3. No Coverage for Engine Damage Due to Water Ingress (Unless Engine Secure Is Opted)
Damage to internal engine parts due to water ingress or oil leakage is not covered under Bumper-to-bumper insurance unless an engine protection add-on is also purchased.
4. Consumables Excluded
Items like engine oil, coolant, nuts, bolts, brake fluid, and similar consumables are not covered under this add-on unless the consumables cover is separately included.
5. Unauthorised Use or Driving Without a Valid License
Claims are rejected if the vehicle is used for unauthorised purposes (e.g., racing or commercial use without declaration) or if the driver does not have a valid license or is under the influence of alcohol/drugs.
Why It’s a Smart Choice
While basic comprehensive car insurance offers broader protection compared to third-party insurance, adding Bumper-to-bumper cover makes the protection near-total. The customer is spared the hassle of paying large sums for depreciated parts, especially during frequent small claims.
Insurers have also simplified the buying process. From comparing plans to selecting add-ons and renewing policies, most providers now allow easy online access and transactions. For instance, customers can choose tailored add-ons during policy purchase and instantly calculate premiums via digital platforms.
Among the insurers offering Bumper-to-bumper insurance, Tata AIG provides an add-on called Depreciation Reimbursement, which allows the insured to claim full repair cost without any deduction for depreciated parts, as long as the claim is admissible under own damage coverage.
Conclusion
Bumper-to-bumper insurance is a must-have add-on for vehicle owners who want maximum financial protection from repair costs. It supplements a comprehensive car insurance policy by eliminating depreciation-related deductions during claims. Although it does not cover everything, the high-value inclusions make it a popular and sensible choice for new or premium vehicles.
Before opting for this add-on, policyholders should understand its limitations, check eligibility, and assess their vehicle usage. When used appropriately, Bumper-to-bumper coverage can provide significant financial relief and peace of mind during stressful situations on the road.
