When purchasing a new car, many vehicle owners often overlook the importance of comprehensive insurance coverage. While a standard car insurance policy provides basic protection, it may not be sufficient to cover the total cost of your vehicle in case of theft or total loss. This is where Return to Invoice (RTI) cover comes into play.
Ever wondered what happens if your car gets stolen or damaged beyond repair? In this article, we’ll help you understand what Return to Invoice (RTI) car insurance really means, why it matters, and how it can help you recover the full value of your car if the unexpected ever happens.
What does RTI in car insurance mean?
Return to Invoice (RTI) is an add-on cover that can be included in your comprehensive car insurance policy. It is not a standalone product and must be purchased along with a base policy. It is designed to bridge the gap between your car's Insured Declared Value (IDV) and its original invoice price. In the event of theft or total loss of your vehicle, RTI insurance ensures that you receive compensation equal to the car's original invoice value, including road tax and registration charges.
How does RTI cover work?
When you purchase a new car, its value starts depreciating from the moment it leaves the showroom. As a result, the IDV of your vehicle, which is the maximum amount your insurer will pay in case of theft or total loss, also decreases overtime. With RTI cover, you are entitled to receive the car's original invoice value, irrespective of its depreciated IDV at the time of the incident. The premium for RTI cover is calculated as a percentage of the car's original invoice value and varies depending on the make and model of the vehicle.
For example, let's say you bought a car for ₹10 lakhs, and after two years, its IDV has depreciated to ₹7 lakhs. If your car is stolen or damaged beyond repair, a standard comprehensive policy will only pay you ₹7 lakhs. However, with Return to Invoice cover, you will receive the full ₹10 lakhs, ensuring that you can replace your lost vehicle without any financial burden.
Benefits of RTI
RTI is particularly useful in situations where the car is stolen, or the damage is so extensive that it is considered a total loss. Here are the benefits of RTI:
1. Complete financial protection: RTI cover safeguards you against the financial loss arising from the theft or total damage of your vehicle. It ensures that you receive the car's original invoice value, helping you purchase a new vehicle of the same make and model without any additional expenses.
2. Covers depreciation: With RTI insurance, you need not worry about the depreciation of your car's value over time. The cover ensures that you receive the full amount you paid for the vehicle, including road tax and registration charges.
3. Peace of mind: Knowing that your car is fully protected against unforeseen circumstances provides a sense of security and peace of mind. RTI cover allows you to enjoy your driving experience without worrying about the financial implications of theft or total loss.
4. Simplified claim process: In the event of a claim, having RTI cover simplifies the process. You need not negotiate with the insurer regarding the compensation amount, as you are entitled to receive the car's original invoice value.
What does RTI include and exclude?
Understanding the inclusions and exclusions of RTI is crucial to make informed decisions. Return to Invoice cover includes the following:
· Ex-showroom price of the car
· Road tax and registration charges
· Insurance premium
However, it is essential to note that RTI does not cover the following:
· Accessories or modifications made to the car post-purchase
· Consequential damages or losses arising from the theft or total loss of the vehicle
· Liability towards third parties
Examples of RTI in car insurance
Let's look at a few scenarios to understand how Return to Invoice cover works in practice:
1. Theft: If your car is stolen and not recovered within a specified period (usually 90 days), your insurer will settle the claim by paying you the original invoice value of the car, including road tax and registration charges.
2. Total loss due to accident: If your car is damaged beyond repair in an accident, the insurer will declare it a total loss. With RTI cover, you will receive the car's original invoice value as compensation.
3. Total loss due to natural calamities: If your car suffers total loss due to natural calamities like floods or earthquakes, RTI cover ensures that you receive the full invoice value of the vehicle.
Secure your car’s full value with RTI cover
Return to Invoice cover is a valuable add-on that every car owner should consider while purchasing insurance. It provides comprehensive financial protection against theft and total loss, ensuring that you can replace your vehicle without any monetary burden.
By opting for RTI insurance, you can enjoy a worry-free driving experience, knowing that your prized possession is fully secured. If you are looking for car insurance with add-on RTI cover, check out the insurance coverage offered by Generali Central
FAQs
1. Is RTI cover mandatory in car insurance?
No, Return to Invoice (RTI) cover is not mandatory. It is an optional add-on available under comprehensive car insurance policies. While not compulsory, it is highly recommended for new car owners who want enhanced financial protection in case of theft or total loss, as it helps bridge the gap between the Insured Declared Value (IDV) and the actual invoice cost.
2. Can I purchase RTI cover for a used car?
No, RTI cover is typically available only for brand-new vehicles. Most insurers allow this add-on for cars that are not older than 3 years. For used or older vehicles, insurers recommend other add-ons like zero depreciation or engine protection instead.
3. How is the premium for RTI cover calculated?
The RTI premium is calculated as a small percentage of your car’s original invoice value. It depends on factors such as the make and model of your car, engine capacity, and the insurance provider’s pricing. Usually, it adds around 5–10% to your base premium for a comprehensive policy.
4. What is the difference between RTI and zero depreciation cover?
RTI (Return to Invoice) cover compensates the policyholder with the original invoice value of the car in the event of total loss or theft. This includes road tax and registration fees, if applicable. Zero depreciation cover, on the other hand, ensures that no depreciation is deducted on replaced car parts during repairs, resulting in higher claim amounts for partial damage. Both add-ons serve different purposes and can be opted for together for comprehensive protection.
5. Can I claim RTI for partial loss or damage to my car?
No, RTI cover is only applicable in cases of total loss (where repair is uneconomical) or irrecoverable theft of the insured vehicle. It cannot be used for minor or partial damages, where the vehicle is repairable. In such cases, standard comprehensive coverage or other add-ons like zero depreciation would apply.
