Insured Declared Value (IDV)

## What IDV means Insured Declared Value is the agreed market value of your car or two-wheeler, set when you buy or renew the comprehensive (own-damage) motor policy. It represents the maximum the insurer will pay in the worst case — a theft or a total/constructive total loss where the vehicle can't be economically repaired. It is essentially the sum insured for the vehicle itself.

## How IDV is calculated IDV starts from the manufacturer's listed ex-showroom price of your model and applies an IRDAI depreciation grid by age. The standard rates are roughly: 5% for vehicles up to 6 months old, 15% for 6 months–1 year, 20% for 1–2 years, 30% for 2–3 years, 40% for 3–4 years, and 50% for 4–5 years. Beyond 5 years (and for obsolete models), IDV is mutually agreed between insurer and owner based on condition. Registration cost and insurance are excluded; some accessories can be added separately.

## Why getting IDV right matters IDV is a balancing act:

- Too low an IDV lowers your premium but means a smaller payout on theft/total loss — you lose money exactly when you need it most. - Too high an IDV raises premium without extra benefit, since the insurer still pays only the *actual* value at claim.

For total-loss claims, IRDAI treats the IDV as the market value with no further depreciation during the policy year, so the figure you fix is what you get. A vehicle is usually declared a Constructive Total Loss (CTL) when repair costs exceed about 75% of IDV.

## Practical tips - Don't blindly accept the lowest IDV an aggregator offers just to cut premium; pick a value close to the genuine resale price. - If you've added CNG kits or accessories, declare and insure them so they count toward payout. - Consider a Return to Invoice (RTI) add-on for newer cars, which pays the original invoice value (not the depreciated IDV) on total loss/theft — closing the gap depreciation creates.