Second-Year Car Insurance: Valuation for One-Year-Old Vehicle

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Second-Year Car Insurance: Valuation for One-Year-Old Vehicle

Hello, Im interested in finding out the insurance cost for the second year of my vehicle. The car was purchased a year ago for approximately 42 lacs, and the current price of a new car is around 72 lacs. Im aware of the 20 percent depreciation on parts, so Im wondering what the appropriate insured value should be for my one-year-old car. The agent is suggesting insuring the car at the full price of a new car, but I believe that since my car is a year old, the insured value should reflect that.

Alina Shah asked on 09 Aug 2023 16:50:26 pm

1 Answer

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Faizan Raza - on 09 Aug 2023 17:08:04 pm

Based on the provided renewal notice received last week, it is imperative to ensure coverage at the prevailing market value. This precaution is underscored by a past incident where my friend encountered additional expenses labeled as under market value insurance charges, coupled with depreciation adjustments during the claims process, due to insuring the vehicle below market value. Consequently, opting to insure the car at its Current Market Value is the prudent course of action.