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What is the difference between Comprehensive and Bumper to Bumper Insurance?

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What is the difference between Comprehensive and Bumper to Bumper Insurance?

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You must know that getting insurance for your car is mandatory if you want to drive it legally on the roads in India. And car insurance comes either in the form of third-party insurance or comprehensive insurance (which covers both third-party and own damage insurance). But there’s another: bumper-to-bumper car insurance. And what is the difference between comprehensive and bumper-to-bumper insurance? Let’s find out.

What does Comprehensive Insurance mean?

Probably, the best insurance coverage for your car is a comprehensive vehicle plan. In addition to taking care of third-party responsibilities, it also covers any own damage or loss caused to your vehicle. More coverage can be added to this plan by purchasing add-ons like engine protection, personal accident cover, etc., which is unavailable when you have only third-party liability insurance. You can also claim damages caused due to explosions, fire, vandalism, riots, floods, storms, cyclones, etc. 

When should you choose comprehensive insurance?

People who require larger car insurance coverage and those who require financial protection in the event of vehicle damage can choose this plan. The Comprehensive Insurance Plan's coverage features are listed below:

  • A result of an accident damages
  • Natural catastrophes' damages (cyclones, floods, storms, etc.)
  • Vehicle theft
  • Damages brought on by man-made disasters
  • Damage caused by a fire or explosion
  • Damage that cannot be repaired (total loss)
  • Liabilities to third parties for injuries, fatalities, or property damage

What is bumper to bumper insurance meaning?

Bumper-to-bumper car insurance is an add-on cover to comprehensive insurance, meaning nil depreciation or zero dep insurance plan. It offers full coverage for your vehicle. In this case, depreciation is also not considered if there is any claim, and your car is considered brand new. This means — even if your vehicle is damaged, stolen, or destroyed beyond economical repair, you will still receive the full amount insured under your car insurance policy for your vehicle, with no depreciated cost deductions.

When should you choose bumper-to-bumper insurance?

Comprehensive car insurance coverage does not cover a vehicle's everyday wear and tear. As a result, the insurance will not fully compensate you for the damage to your car while claiming any damage. A comprehensive insurance policy excludes coverage for subsequent harm.

Below are the reasons ‌you must choose a bumper to bumper insurance:

  • If you have recently purchased a car/ bike that is less than 3 to 5 years old
  • If you have a high-end model car with expensive parts
  • If you are a learner, you must choose
  • If you are looking for higher coverage and low out-of-pocket expenses
  • If accidents are not a rare thing for you and minor dents & scratches also bother you
  • If you want to eliminate the effect of depreciation on your vehicle insurance claim.

Difference between Comprehensive and Bumper to Bumper Insurance

Look at this table to understand the differences between Comprehensive and Bumper to Bumper Insurance:

Comprehensive Insurance

Basis

Bumper to Bumper Insurance

It is a freestanding insurance policy

Nature

It is an add-on coverage that is opted along with an insurance plan 

It offers comprehensive coverage to your vehicle against theft, fire, natural or man-made disasters, accidents, etc. You can always opt for an add-on cover

Coverage

It provides complete zero depreciation coverage for your vehicle

Depreciation is deducted from the claim amount you receive for the damage to your car

Depreciation

You can get the full claim amount for the replacement or repairing of your car's parts

The premium amount is lower compared to bumper to bumper insurance

Premium

The premium amount is slightly higher compared to comprehensive insurance

All cars, old or new, can avail of this policy

Eligibility

Cars older than 3 to 5 years cannot be insured in this policy

It is a combination of third-party liability and own-damage

Purchase

Being an add-on, it can only be included along with the standalone-own damage or comprehensive insurance 

You can only claim twice during the entire tenure of the insurance plan

Number of claims 

You can claim as many times as possible (terms and conditions applied)

Comprehensive vs Bumper to Bumper Insurance -  which is better?

The comprehensive plan covers third-party liability and damages to the insured car, including theft, i.e. irreparable harm. Additionally, you have the choice to merge pertinent add-ons to lessen the impact of financial treatment. Thus, it is a much better option than third-party liability-only insurance. 

Often referred to as a "complete" plan, comprehensive insurance does not provide coverage for various incidents:

  • For the depreciation of the vehicle and its components
  • For typical wear and tear of vehicle components
  • For damages to tyres & tubes — however, the insurer will cover 50% of the replacement cost (if the car is also destroyed at the same moment).

Now let's discuss bumper-to-bumper insurance. Remember:

  • Purchasing the add-on would be slightly more expensive and may cost you around 15% to 20% more than your regular premium.
  • You'll be able to make only up to 2 zero-dep claims in a year, depending on your insurer's policy.
  • This add-on is offered by companies based on the condition of your bike/ car. The coverage is available for vehicles up to 3 or 5 years old.

Despite these limitations, a zero depreciation cover has benefits in the long run. To give you an idea of how much loss depreciation can cost you, here is the table of vehicle value depreciation with time.

Age of the Vehicle

Rate of Vehicle Depreciation 

Within 6 months

5%

6 months to 1 year 

15%

1 year to 2 years

20%

2 years to 3 years

30%

3 years to 4 years

40%

4 years to 5 years

50%

First-time automobile owners would especially benefit from this rider because it simplifies the claim payout procedure by covering the depreciation portion of the claim. Due to the better coverage, it provides for the expensive parts of the vehicle, owners of high-end cars and bikes prefer this plan more.

In conclusion

Unexpected events may result in damage to your vehicle. Although the comprehensive insurance policy offers protection against such obligations, the coverage is not 100%. A large amount of depreciation is charged to your vehicle every time you make a claim. 

On the other hand, bumper-to-bumper insurance helps you save big as your vehicle doesn’t bear the depreciation loss. This add-on enhances the overall protection to protect the vehicle (100% coverage with no depreciation). Weigh the pros and cons and choose the most appropriate vehicle insurance plan.

Frequently Asked Questions

1. What is better comprehensive or collision?

Comprehensive coverage pays for theft or damage from events like severe weather, fire, or falling trees. In contrast, collision insurance covers damage to your car if you collide with an object or vehicle.

2. Is it worth having fully comprehensive insurance on an old car?

If you use your car regularly, then you must have a comprehensive cover because an accident can happen anytime, anywhere. Also, an outdated car's poor performance can result in an accident. Car insurance coverage will be helpful for the vehicle owner in such a situation.

3. What deductible should I choose for comprehensive?

To keep your premium amount lower, you may choose a high deductible comprehensive plan for your older vehicle with a low value. Alternatively, you might want to select a lower deductible if you reside in a region where auto accidents, animal-vehicle collisions, and natural catastrophes are frequent in order to reduce out-of-pocket expenses.

4. What is not covered by bumper-to-bumper car insurance?

A bumper-to-bumper car insurance cover provides financial protection for all metals, fibre, and rubber components of the vehicle. It doesn’t include harm to

  • Engine
  • Gearbox issues caused by water ingression or oil leaks. 

5. What is bumper to bumper in insurance?

Bumper-to-bumper car insurance is an add-on cover to comprehensive insurance, meaning nil depreciation or zero dep insurance plan. It offers full coverage for your vehicle. In this case, depreciation is also not considered if there is any claim, and your car is considered brand new. This means — even if your vehicle is damaged, stolen, or destroyed beyond economical repair, you will still receive the full amount insured under your car insurance policy for your vehicle, with no depreciated cost deductions.

6. Is it good to take bumper to bumper insurance?

Having a bumper to bumper insurance ensures that you can claim full compensation for any car damage.

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