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Category: Motor Insurance

Add on covers in Motor Insurance

What it means to you…

Zero or nil Depreciation

Over the past few years more innovative Additional Covers are introduced by various Insurers to benefit Vehicle Owners. The Additional Covers come with additional premiums collected during the inception of the policy. Given below are a few important add on covers and what they meant to you..

In the case of damage to the vehicle,  the standard motor package policy pays for the replacement of parts namely metal, plastic and fibre or rubber after deducting certain percentage towards depreciation based on the age of the vehicle.

Zero/Nil Depreciation add on cover allows the insurer to pay the claim towards replacement of parts without deduction towards depreciation, thereby 100% cost of replacement paid. This cover is available generally for vehicles up to 5 years of age only.

NCB Protection

No claim bonus (NCB) is applicable on renewal of the policy for every claim free policy year.  Normally, in the event of any claim, this discount is withdrawn completely on renewal and NCB becomes NIL.  NCB Protection add on cover protects the NCB earned until last year, even if there is a claim in the existing / expiring policy.  This benefit is available for limited number (1 or 2) of own damage claims only.

Invoice cover or return to invoice

Invoice cover allows the Insurer to pay the invoice price of the vehicle due to an event of a claim of total loss or theft of the vehicle. The ex-showroom price of the same make and model on the date of accident at the place of registration of the vehicle will be paid.  This cover is available for less than 3 years old vehicles.

Engine protect cover

This add on cover provides protection against damage to engine and its parts due to ingress of water, which is common during monsoon.  Such losses are not payable under standard motor policy. Normally this cover is available for vehicles which are less than 5 years old.

Key and lock replacement

This add on is applicable if the vehicle keys get misplaced or stolen or lost.  Insurers will compensate for the cost of replacement of key and lock. Key and lock replacement is pretty costly in high end vehicles where this cover becomes absolutely important.

24/7 roadside assistance

Under this add on cover, in the event of breakdown of vehicle, insurers will extend assistance on the spot like providing refuelling, towing, change of flat tyre, battery, minor repairs, accommodation assistance to make the vehicle mobile and comfort to the insured.  However, the scope and value of cover will differ from insurer to insurer based on their product plan. Few insurers offer minimum scope of 24/7 assistance at free of cost and others charge a premium.  

Cover for consumables

This cover pays for money spent on nuts and bolts, screen washers, engine oil, etc. in the event of accident to the vehicle which are normally not paid under standard motor policy.  This cover is extended for vehicles of up to 3 years of age.

Daily allowance

This cover pays for the cost of hiring an alternative vehicle if the insured vehicle is stolen or while under accidental repairs. The amount payable per day and the number of days the amount is payable varies from insurer to insurer.  This facility is not available if the repair is not carried out at an authorised garage (Network) of an insurer.  And if the repair is carried out within 3 days, it is not payable.

baggage cover

Baggage, personal belongings of the insured, if lost in the accident is covered under this add on.  This only covers, items such as clothes, toiletries, etc., and not jewellery, mobile, laptop such costly items subject to a limit put in the policy.

Driver Cover

This is a personal accident cover for the owner driver

passenger cover

This is a personal accident cover for all passengers based on the seating capacity of the vehicle.

cover for road tax

This cover is over and above ‘Invoice Cover‘, where in case of a total loss of vehicle, the insurer will pay the cost of road tax for the new vehicle purchased.

Towing and related

This cover is a part of road side assistance. In case of an accident, this add on cover will enable insurer pay for the charges related to towing the vehicle to the nearest/network garages for repair.


Additional electrical and non-electrical accessories fitted in the vehicle can be covered by opting and declaring the value of such accessories. Usually, the value will be added to the IDV of the vehicle to cover for any theft/burglary/damages of the accessories.