Car depreciation rate for insurance

For specific components of the car, the rate of depreciation varies as per the below The older the car is, the lesser will be the value you get. Physical condition and mileage of the car are also considered. Since parts of luxury vehicles are hard to find and are more costly, these types of cars have a higher depreciation value.

In event of you making a claim; the car insurer would pay you the claims only after deducting the depreciation, therefore you would receive compensation lower than the market value of car. The older the car, greater is the depreciation. You might feel that there is issue with car insurance policy but it is not so.

The rates of depreciation are as mentioned below: In case of a paint job, a depreciation rate of 50% is applied to the material cost of the paint. In case a consolidated amount is charged for the paint job, then the cost of paint material is considered to be 25% of the total cost and the 50% rate of depreciation is applied on it.