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Why lower IDV is not the best option for your motor insurance?

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What is IDV?

IDV stands for that maximum sum which is insured, the amount of which is agreed upon by the insurance provider that will be then reimbursed to the policyholder in cases of loss being either partial or complete. These losses can be either in the cases of theft or accidents or etc. thus the IDV is basically the current market value of your automobile that is insured. The full form of IDV is Insured Dealer value and is a vital aspect when it comes to the determination of the comprehensive car insurance cover premium. Now the value of the IDV is determined on the basis of the present value of the manufacturer’s and the depreciation that comes with the age of the vehicle.

Why is it so that the lower IDV is not considered as the best option for the motor insurance?

When the vehicles are old, the IDV id then calculated after a mutual agreement that takes place between the insurer and the insured. Here factors like car’s model and the availability of the spare parts play a major role on determining the IDV. Thus in cases like these, instead of the depreciation, the IDV can be determined by examining the vehicles’ condition. And then either the dealer or the insurance surveyor does that.

Now depending upon the manufacturer’s listed selling price, the IDV of the car is being fixed. Here the selling price of the brand and the model is taken into consideration. And that value should be considered at which it was before the insurance scheme was purchased or the time of the policy renewal and then adjusted for the depreciation.  Also those accessories which are fitted to the motor but are not included in the list selling price of the manufacturer can also be done in the similar manner.

The car insurance coverage and its feature keep changing year after year. Now if you are ever asked by your insurer to pay to a certain price when the time of renewal comes, first make sure to check the IDV of your car and whether the charge of the premium is justified or not. You can opt to negotiate for the prices if you are not satisfied with the figures. Now since the premium is determined when you are renewing your OD motor policy, so the value of the car is higher, you may have to pay more policy and if the value is lower you may have to pay lowered premium. This because possible in the case of online method when the auto insurance policy is renewed.

Now since insurances are long term plans that are meant to keep your things secure. Now since your automobile is an important liability, it is necessary that you keep the IDV value higher. This is because at the time of making claim you can expect to get an expected amount which may not be the situation in case if you opt for a lower value of the IDV. Because the deduction in your reimbursements mainly due to the IDV.

Conclusion

Thus since the IDV is the maximum amount that one can claim so that their losses can be compensated, make sure that they are of higher value.

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