Vipul wanted to buy a new car by putting his three-year-old car for resale. Given that his car’s registration and motor insurance policy documents were in place, he was expecting a good sum of money on its re-sale. However, the prospective buyers were quoting less than half of its actual sale price, and he was compelled to sell it off for a more than 50 percent depreciation value. Had he bought a zero depreciation cover along with the motor insurance policy, Vipul would have fetched a decent resale value for his car.
If there is one word that can describe the unavoidable reality of your vehicle, it would be ‘depreciation’. Depreciation refers to the declining value of your vehicle due to wear and tear over a period of time. The older the vehicle gets, and the more kilometres it travels, the lower shall be its resale value. Here are a few factors that influence a vehicle’s resale value:
Mileage: This is the single most important factor when it comes to the vehicle’s resale value. The more kilometres, the more likely your vehicle will depreciate quickly in value. A car that is five years old and has a five-digit mileage would give a better resale value than a car that is three years old with a six-digit mileage due to the wear and tear that it undergoes.
Age and Condition: If your vehicle is old and has undergone a lot of wear and tear in a short time and needs major servicing or repair, then your vehicle’s category shall be classified as poor when its value is assessed. Consequently, a vehicle in poor condition can drastically minimize its resale value.
Trim and Safety feature: Having a higher trim, i.e., more and better features like navigation, seat fabric, automatic climate control system, sunroof, etc., and quality safety features like collision warning and blind-spot assistance can fetch your vehicle higher resale value.
Steps to increase your vehicle’s resale value
Listed below are certain steps that can ensure your vehicle gets a high resale value:
Watch the mileage: A six-digit yearly mileage is detrimental and can drop your vehicle’s value steeply.
Avail professional servicing: Pay attention to the little things such as polishing the faded headlight lenses, fixing those minor dents or scratches, or applying an anti-corrosive coat to your vehicle’ exterior from an authorized service provider. It would be a good idea to get some thorough professional servicing done to your vehicle before listing it for sale. Opt for replacement of worn parts with the genuine ones only. Bajaj Allianz motor insurance, available on Finserv MARKETS, offers a zero depreciation cover allowing you to claim the full cost of damaged or replaced parts. The zero-depreciation cover shall also maintain your vehicle’ resale value. Also, preserve your vehicle’ service history carefully to provide proof that it is well-maintained.
Routine maintenance: Maintain your vehicle’s exterior, and ensure that there are no scratches and dents. Too much sun can fade the car’s paint, colder temperatures can wreak havoc on the engine and its parts, and rains can contribute to corrosion. Placing the car in a climate-controlled environment, such as the garage can help avoid exposure to extreme temperatures and dust. Also, clean your car regularly at least once in a fortnight and replace the dirty floor mats periodically to protect the interiors. A clean and spotless vehicle can impress a prospective buyer and fetch you higher resale value.
A valid motor insurance: Having a valid comprehensive insurance policy can return a lucrative resale value for your bike. If your policy has lapsed, do renew it before putting up your bike for sale. Once the policy has been renewed, the new buyer may get himself endorsed to avail the benefits, for which he will have to approach the insurer within 14 days of purchasing the bike with NOC from your side. Good motor insurance policies like Bajaj Allianz two wheeler insurance and Bajaj Allianz car insurance also offer a no claim bonus (NCB) benefit as high as 50 percent that can be availed online on Finserv MARKETS.
No claim bonus is an indicator of your car’s health and can enhance your car’s resale value. Do remember to request for ‘No Claim Bonus’ reserving letter from your insurer, using which you can avail a discount on your new car insurance policy within the next two years of the sale of your used car.
Safety features: While you buy your new car, it would be prudent to pick some additional safety features like collision warning system, automatic emergency braking system and more by spending some extra money. Add-on safety features might weigh heavy on your pocket, but they could pay off when you wish to sell your car. They return a better resale value for your vehicle because nothing beats safety in the list of life’s priorities.
The Bottom Line
Implementing the above steps may seem inconsequential at first, but by being mindful of them when needed will pay off in the long run as they will ensure that you rake in the right moolah while selling or trading in the car. A well-maintained car that comes with the right insurance and documentation has a better chance of getting a higher resale value.
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