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IDV Basics in Car Insurance

Do you want to know what IDV means in a vehicle insurance policy? Read on to find out why IDV (insured declared value) is an important consideration to consider when purchasing insurance.

Table of contents
Insights on IDV in Vehicle Insurance
What does IDV mean in car insurance?
Take away

We are all aware that there are a large number of terms in the world of vehicle insurance that are difficult to decipher but necessary to understand. One of these words is IDV. IDV stands for the declared value insured in its entirety. In the event that the insured vehicle is assembled or lost, the IDV (declared value insured) is the largest value guaranteed by the insurance company that the policyholder is entitled to in terms of compensation. This refers to the current market value of the insured vehicle. In other words, IDV is the maximum amount that the policyholder can be compensated for insured vehicle damage. When the policy holder buys comprehensive insurance on the vehicle, IDV is taken into account. The amount of the premium paid by the policyholder is directly proportional to IDV. Although premiums typically range from 2% to 3% of the total value of IDV, the higher the IDV, the higher the premium.

Insights on IDV in Vehicle Insurance

Many Indian car owners believe that car insurance is complex. One reason for this may be the terms used (for example, the declared value insured), which the average person may find difficult to understand. Understanding its meaning and impact on vehicle insurance coverage, premiums and claims is one way to simplify it. Here's everything you need to know about IDV, including what it is, how to calculate it, how to advertise the correct IDV, among other things. Accidents are unfortunate events that not only cause damage to your vehicle, but also put you at risk of third-party responsibility. These third-party responsibilities may be for material damage, such as car damage, or for someone else's physical injury. You won't worry about these costs if you have insurance coverage on the car. However, if you don't have insurance, you risk burning a hole in your pocket and inviting legal problems as a result of repair costs. Before you get any kind of vehicle insurance, you must first understand the basics of how it works. The purpose of this article is to highlight one of the most important insurance topics: the declared value insured, or IDV.

What does IDV mean in car insurance?

The declared insured value, or IDV, is the highest amount the insurance company will pay in the event of car damage that cannot be repaired or requires the rescue of the vehicle. The term "total loss" is used to describe this situation. In addition, the insurance company may pay IDV as compensation in the event of a constructive total loss. In the case of theft, the same conditions apply. IDV is often confused with the value of reselling the car. In fact, it is the current market value of the car that the insurance company pays to settle for. For example, your Car Insurance Policy IDV is set at 4.5 lakhs. As a result, if your car is irreparably destroyed, the highest compensation your insurance will pay is 4.5 lakhs.

Take away

If your vehicle is totaled or stolen, the declared insured value (IDV) is the maximum compensation you will receive. Always study and check again with the car manufacturer before approving the IDV specified by your insurance. Check your car premium to check if it has been calculated correctly based on the IDV for your car. You can bargain with your insurance company to get the IDV you want, as having adequate coverage to ensure your car is critical. Policyholders can also change IDV for their car online, however, value may vary from one insurance company to another. The IDV repair also allows you to update it while renewing your car insurance policy. 

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Disclaimer: This article is published in the public interest and is intended for public information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should conduct further research or consult an expert in this regard.

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