What is Return to Invoice Cover in a Car Insurance Policy?

Buying a new car marks a significant moment for many, a combination of enthusiasm, satisfaction, and careful budgeting. What happens if your brand-new car is stolen or experiences irreparable damage in the first year? A regular car insurance policy will only reimburse the depreciated value of your vehicle. The outcome could mean a significant financial gap between what you paid and what you received. That’s where Return to Invoice (RTI) cover steps in.

In this blog, we’ll walk you through what Return to Invoice (RTI) cover is, how it works, who should consider it, and why it might be one of the smartest add-ons to include in your comprehensive car insurance policy.

What you need to know about Return to Invoice (RTI) cover?

The Return to Invoice cover is an optional add-on that you can choose to have. It covers the difference between how much your car is worth now (called the "Insured Declared Value" or "IDV") and how much you paid for it, plus any road taxes and registration fees that apply. If an accident, fire, natural disaster, or theft renders the car a total loss, this add-on becomes invaluable.

Your insurance company will reimburse you for the original car purchase price if you have Return to Invoice (RTI) cover. This way, you get back your full investment, not just the amount it lost.

What is the Return to Invoice (RTI) cover?

Imagine paying ₹10 lakh for a car and then seeing its IDV drop to ₹8 lakh after a year because it has lost value. If your car is stolen or totally damaged in an accident, most policies will pay you back ₹8 lakh. With the Return to Invoice (RTI) add-on, your insurance company will pay all ₹10 lakh (or almost that much, depending on the terms of your policy), which will cover the costs of both registration and road tax. This tool will save you a lot of money, especially if you have unexpected costs or are still paying off a car loan.

Return to Invoice (RTI): What does it cover?

When you choose the Return to Invoice (RTI) cover, that usually means:

●       How much the car costs when it leaves the store

●       Tax on the road

In some cases, insurance premiums vary by insurer.

Nevertheless, it is crucial to recognise that Return to Invoice (RTI) is only applicable in the event of total loss or larceny. Minor or partial damages are not eligible for coverage under this policy.

Who should consider purchasing Return to Invoice (RTI) coverage?

Although Return to Invoice (RTI) coverage is not mandatory for all drivers, it is highly recommended that certain vehicle owners incorporate it into their policies. If you have recently acquired a new vehicle, it may be advantageous to include this coverage:

●       The initial year's depreciation is substantial, and the full cost is recovered to facilitate a fresh start.

●       Return to Invoice (RTI) helps you repay your outstanding loan amount without diving into your savings if the vehicle is stolen or completely damaged, as your vehicle is financed through a loan.

●       If you live in a city or locality with high rates of vehicle theft or accidents, you face a greater risk of financial loss. In such areas, Return to Invoice (RTI) insurance offers enhanced financial protection by covering the gap between your car’s depreciated value and its original purchase price, ensuring you receive superior compensation if your vehicle is stolen or written off.

●       If you possess a high-end model or luxury car, the protection of the complete value of your investment becomes increasingly critical as it increases.

If you seek complete peace of mind and are unwilling to compromise on protection, Return to Invoice (RTI) enables you to completely mitigate your financial risk, making it an intelligent decision.

The main advantages of Return to Invoice (RTI) Insurance

The main benefit of Return to Invoice (RTI) is that it protects your money. Let's look at a few more things that make this add-on appealing:

1. Get the full value of your car back: You will not get a discounted amount but the invoice value of the car which includes taxes and fees. You can trade in your car for a similar one without having to pay extra.

2. Better than just the IDV-based payment determination: Promised-Ask for Value goes down over time, and it's common for this to happen a lot in the first few years. The problem of lower claim payouts has been fixed by Return to Invoice (RTI).

3. Especially helpful in the first few years of owning a home: In the first two to three years, things lose the most value. What Return to Invoice (RTI) does is "freeze" the car's value so that it can't be sold or stolen.

4. Make your program stronger for everyone: Return to Invoice (RTI) gives you full protection by combining your basic insurance with different add-ons, such as engine protection or zero depreciation.

Limitations to consider

Return to Invoice (RTI), like all add-ons, is subject to certain constraints:

It is typically accessible exclusively for vehicles that are three or five years old, contingent upon the insurer.

●       It is exclusively applicable in the event of an irrecoverable theft or complete loss. It does not provide coverage for routine repairs or partial damage.

●       The add-on is priced at an additional premium. Nevertheless, for numerous vehicle owners, the additional peace of mind is well worth the investment.

●       It is also crucial to comprehend the specific terms and conditions of your insurer prior to making a purchase. This includes the invoice costs that are covered and whether the policy covers used or demo vehicles.

What are some ways to include Return to Invoice (RTI) coverage in your policy?

When you buy a new comprehensive auto insurance policy or renew a current one, you can choose to include Return to Invoice (RTI) coverage as long as your automobile is in the appropriate age range. If the age and usage of the vehicle meet the requirements, you could still be able to incorporate RTI if you are renewing older insurance and switching insurers.

Return to Invoice (RTI) can be easily added with a few more clicks because most insurers now provide it as a selectable add-on during the digital policy-buying process.

Zurich Kotak General Insurance's Return to Invoice (RTI)

Zurich Kotak General Insurance is committed to providing insurance solutions that are pertinent to the needs of car owners in the present day. Our comprehensive car insurance plans include add-ons such as zero depreciation, return-to-invoice, and roadside assistance, which are intended to safeguard your investment, not just your vehicle.

When you choose Return to Invoice (RTI) with us, you can anticipate the following:

●       Fast and transparent claim processing

●       Options that are adaptable to the age and utilisation of your vehicle

●       Digital policy management is seamlessly integrated.

Is it worthwhile to invest in Return to Invoice (RTI)?

Many drivers believe that Return to Invoice (RTI) coverage is a prudent way to mitigate the financial effect of unexpectedly losing a new car, even if it may be optional. It guarantees the protection of your investment, both in terms of theoretical and actual returns, allowing you to start over without having to deal with significant financial pain.

It's a good idea to consider adding return-to-invoice coverage to your policy when you buy your first vehicle or upgrade to your ideal vehicle. The value of your car outweighs the impact of depreciation.

Learn more about Zurich Kotak General Insurance's personalised car insurance plans today, and be sure to use the Return to Invoice (RTI) add-on to maximise the value of your automobile.