IDV Calculator

Knowing the exact IDV of your vehicle helps you get the right policy and adequate coverage. With tools like the IDV calculator for car insurance, you can know exactly how much you need to plan for policy premiums. 

This online tool calculates the market value of your car based on its price, purchase year, and brand/model. Enter these parameters and calculate the IDV of your car within seconds. You can then compare policies on Bajaj Markets and choose the ideal one from a top insurer.

IDV refers to the market price of a car. It is the highest value receivable for a car from the insurance provider in case of theft or if it gets damaged beyond repair.

 

It is the primary factor that influences your policy premium and the claim settlement limit. Insurance companies generally decide your car’s market value based on several factors, including the following:

• The make and model of the car

• The car’s variant and age

 

The automobile company lists the IDV of a car when they manufacture it. However, car owners declare the updated IDV by deducting depreciation costs when buying or renewing the insurance policy. 

When you buy a car, insurance companies take the manufacturer’s selling price as its IDV by taking depreciation into account. You can use the following formula when computing your car’s IDV:

IDV = Manufacturer’s registered price - Depreciation 

 

If some accessories were not added by the manufacturer at the time of the car’s delivery, include them as an additional expense. The formula will then include accessory components, such as dash cameras, back support for seats, fire extinguisher, and more. 

 

Insured Declared Value = (Manufacturer’s listed price – Depreciation value) + (Cost of the vehicle accessories – Depreciation value of accessories)

 

Calculating IDV manually can be a tedious job and requires time and effort. Use the IDV calculator to calculate the ideal market value of your car instantly without any hassles or potential for errors. 

 

Follow these simple steps to calculate your car’s IDV on this page using the online tool:

1. Select ‘Four-wheeler’ under the ‘Vehicle Type’ category

2. Enter the ‘Vehicle Number’ and ‘PIN Code’ of the region where the car has been registered

3. Provide your mobile number and hit the ‘Calculate IDV’ button to get the estimated market value of your vehicle

The Insurance Regulatory and Development Authority (IRDAI) is a statutory body established by the Government of India to regulate the insurance industry in India. It has set a standard depreciation rate that insurance companies can apply when calculating your car’s IDV.

 

Here are the standard depreciation rates applicable when you calculate the Insured Declared Value:

The insurance company and the insured need to determine the IDV of a car aged over 5 years based on mutual understanding and negotiations. The insurer will use the same process for computing the IDV for a model that the manufacturer has discontinued. 

 

The following rate of deduction will apply to any of the replaced items of your vehicle:

Here is the deduction rate applicable on all other replaced items, including wooden parts, when computing a vehicle’s IDV:

There are several aspects that insurance companies take into account when determining your car’s IDV. These include the following:

Year of Purchase

The age of the car is one of the most important factors affecting the calculation of IDV. The value of your car begins to decline as soon as you drive it away from the dealership. 

 

As your vehicle gets older, its market value or IDV will continue to decline. This decline in the monetary value of your car is termed depreciation. 

Type of Car

There are different variants of cars available in the market, ranging from hatchbacks and sedans to sports and multi-utility vehicles (SUVs and MUVs). Each of these has a different value and the variants within each category differ in pricing too. 

 

For instance, SUVs generally have a bigger price tag compared to sedans and hatchbacks. Within SUV, variants that offer automatic drive are more expensive than those with manual transmission. Hybrid cars are usually pricier too.

Make and Model

The selling price of every vehicle also depends on the make and model of the vehicle. Hence, it also influences your vehicle’s Insured Declared Value. Even a single model can have different IDVs. The brand and the features offered by that model determine your car’s value.

City of Registration

Even though the place of registration has a lower impact on a vehicle’s IDV, it does influence it. This is because the ex-showroom price of a car can be different in Delhi from that of Bengaluru. 

 

Moreover, registration charges may be higher in metro cities with heavy traffic as vehicles are more prone to accidents. 

Additional Accessories

The cost of depreciation also applies to your car accessories, which are accounted for by an 

IDV calculator. Hence, your car’s market value will also depend on the age and working condition of the accessories you have chosen to add.

Choosing the right IDV is crucial for striking a balance between adequate coverage and affordability when buying a policy. Here is the significance of Insured Declared Value in car insurance:

• The IDV determines the maximum compensation that you can get against your car insurance

• Your car’s IDV will also determine the risk level of your policy, with a higher IDV indicating a higher risk

• The insurance companies decide the policy premium amount based on this value

• The repair and replacement expenses will also depend on your car’s IDV in instances when you plan to settle a claim 

• If your car gets damaged beyond repair or stolen, the insurer will provide you with an amount equal to the Insured Declared Value

It is only the coverage of comprehensive car insurance that depends on the Insured Declared Value. It does not apply to third-party insurance policies which is only concerned with third-party damage. 

 

IDV thus determines the quote for your insurance policy when you choose a comprehensive plan for better protection. A higher IDV represents wider insurance coverage, which results in a higher premium quote.

 

Similarly, lower IDV indicates lesser coverage with lower premiums. Choosing lower coverage can be tempting, especially for older cars that have gone through significant depreciation. Be careful that you do not undervalue your car to save on premiums. This can result in a lower amount that you can claim during a calamity. 

In most cases, you do not need to calculate IDV for claim settlement. However, you will need to declare IDV when buying a comprehensive car insurance plan. Here are circumstances in which IDV comes into the picture during claim settlement:

Theft

If the police declare your car as non-traceable after theft, you can claim an amount equal to IDV from the insurer.

Constructive Loss

When your car gets damaged due to a contingency, the insurer will assess the damage. If there is damage of 75% or more, the insurer will disburse the entire IDV amount as a claim settlement.

Total Loss

You can raise a claim for total loss if your car gets damaged beyond repair. Here, the insurer will provide you with the entire IDV amount when settling your claim.

When applying for car insurance, here are a few aspects that you must remember about IDV:

Take All Deductions Into Account

Calculate the car’s value by accounting for the cost of depreciation. Moreover, deduct the cost of fuel and maintenance from the market price of the vehicle. 

Avoid Understating IDV

Do not reduce the IDV for to lower the premium as this results in an inadequate claim amount in case of damage or theft. 

Refrain from Overstating IDV

When you overstate the IDV, your premium will increase unnecessarily. During the claims process, the insurer may notice an inflated figure. Thus, it may not compensate you based on the IDV but only on losses incurred.

Avoid Providing Inaccurate Value

Do not provide an inaccurate Insured Declared Value when applying for car insurance to prevent your claim from being rejected. Use an IDV calculator for car insurance to get an exact and appropriate figure. 

Check with the Manufacturer

Conduct a check about the insurance value before applying for a policy. Also, discuss the IDV decided by the insurance company before agreeing to it.

Increasing your Insured Declared Value has both pros and cons. Here are the advantages of choosing a higher IDV:

• A higher IDV translates into a higher assured sum against your car insurance plan

• You can also get a higher claim in case of an accident if you set a higher IDV, allowing you to avoid paying for the damages out of pocket

• If you have purchased a new car, a higher IDV will be enough to cover the cost of a new vehicle 

 

The following are some of the cons of increasing your Insured Declared Value:

• If you set an increased IDV, it can result in an expensive insurance policy as the premium amount will rise

• You may never fully benefit from high IDV if you never need to claim a settlement for total loss

 

Similarly, decreasing your car’s Insured Declared Value also has its advantages and disadvantages. Here is how decreasing your car’s IDV can provide you with several benefits:

• As mentioned earlier, your insurance premiums reduce if you opt for a lower IDV, making the policy more affordable

• Lower policy premiums can help you save more on the policy’s cost over time

• You can save this money to buy insurance riders that can help you increase coverage for your car

 

The following are some of the drawbacks of decreasing your Insured Declared Value:

• As a low IDV translates into a lower sum insured, you may not be able to recover your entire loss or the car’s full value 

• If the repair costs after an accidental claim exceed the IDV, you will have to pay the remaining amount from your pocket

It is best to declare an IDV as close to your car’s market value as possible. However, you can declare an increased Insured Declared Value in the following cases:

• If you own a luxury or an expensive car

• If your car’s parts are expensive, hard to get, and require high expertise for repairment

• If you can easily pay for a higher premium amount

 

Here are some of the circumstances in which it makes sense to declare a lower IDV:

• If you own an old car or a vehicle whose market value is not much 

• If your budget doesn’t allow you to allocate enough towards premiums

• If your finances will not be strained in case of a total loss

There are two reasons why IDV is significant when choosing an insurance policy.

• Your car’s IDV is one of the most crucial factors when deciding its insurance premium

• IDV also determines the maximum coverage that your insurer will provide on a total loss for your car when it is beyond repair or gets stolen

 

IDV is thus essential in deciding the premium that matches the coverage needed for a car. 

Hence, an IDV calculator for car insurance is a valuable tool that helps you strike a perfect balance between affordability and adequate coverage. 

 

If your vehicle sustains damages, the insurance company will estimate the expenses and provide you with a payout based on the IDV. Generally, insurers pay the entire IDV in case of extensive damage. 

  

The IDV also plays an important part in determining the resale value of your car. If you plan to sell your car, a higher IDV will help you get a higher price. However, the buyer may try to negotiate the price keeping in mind the other aspects of your car.

If you are looking to buy a car insurance policy, consider various aspects related to the policy, including the coverage and payouts. Check out a few car insurance plans available on Bajaj Markets in the table below, along with their important features:

 

Disclaimer: The above-mentioned details are indicative and subject to change as per the insurance provider’s latest updates.

Here are some common inaccuracies related to IDV you should not accept:

Myth 1: You cannot change the IDV decided by the insurer

You can change the IDV decided by the insurer as per your convenience and affordability. To assess the right value, check the IDV provided for cars of similar model, age, and coverage.

Myth 2: The resale value of a car is the same as its IDV

Several additional factors affect the car’s resale value, including the demand for that particular model, its working condition, accident history, spare parts, etc. Hence, the resale value of a car is not similar to its Insured Declared Value.

Myth 3: Declaring a lower IDV helps you save significantly

It is not entirely true that you can save considerably by declaring a lower IDV. While your premium will be low, you will have to pay much more from your pocket if the vehicle meets with an accident and requires repair. 

To make an informed decision, use the IDV calculator for a car when comparing different insurance policies. With the right policy, you can ensure the right amount of coverage and a fair payout in the case of a claim.