Page 147 - Motor Insurance Ebook IC 72

Guide for Motor Insurance

indemnity. The policy clearly indicates the rates of
depreciation to be applied in respect of parts replaced.

However, when vehicle meets with a serious accident
and is repaired in a satisfactory manner, even so it may
have depreciated in value as a result of the accident, in
the sense that if it is offered for sale, the owner may
realize less than what it would have fetched prior to the
accident. This kind of depreciation is excluded by the
policy even though directly caused by the accident.

Depreciation is deducted for parts replaced of an
accident or damaged vehicle. The depreciations is
applied on different type of parts as follow:

For all rubber/nylon/plastic parts, tyre 50%
and tubes, batteries and airbags 30%
For all fiberglass components Nil
For all parts made of glass

For all other parts as a percentage based on the age of

the vehicle i.e like this

Not exceeding 6 months Nil

Between 6 months and 1 year 5%

Between 1 year and 2 years 10%

Between 2 years and 3 years 15%

Between 3 years and 4 years 25%

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