Partial Own-Damage Claim: Depreciation, Betterment and Pre-existing Damage
Mr. Rao's 2019 Maruti Swift (1,192 cc, IDV ₹4,50,000) hit a road divider. The authorised dealer's estimate is ₹1,48,000: front bumper ₹12,000, grille ₹3,000, bonnet repair ₹18,000 (replacement would be ₹28,000), left headlamp ₹9,500, radiator ₹8,000, condenser ₹7,000, labour ₹18,000, paint ₹12,000, engine oil and coolant ₹4,500, wheel alignment ₹1,500, and one front tyre ₹6,500. The policy has ₹1,000 compulsory and ₹2,000 voluntary excess. The vehicle is 2 years 4 months old. The surveyor finds the tyre had about 40% tread left, the bumper had an old repaired crack, the bonnet can be repaired to original shape, and there is no suspension damage. Engine oil was changed at the same visit though it was not contaminated. The insured is not GST-registered. The dealer insists on replacing the bonnet and bumper.
1. Compute the admissible own-damage claim, showing each deduction and the final payable amount.
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Admissible computation (vehicle age 2 years 4 months → 20% depreciation on replaced parts; plastic parts 50%; labour and paint not depreciated):
- Front bumper (plastic): ₹12,000 − 50% = ₹6,000
- Grille (plastic): ₹3,000 − 50% = ₹1,500
- Bonnet: repair allowed at ₹18,000 (cheaper than replacement; see task 2)
- Headlamp: ₹9,500 − 20% = ₹7,600
- Radiator: ₹8,000 − 20% = ₹6,400
- Condenser: ₹7,000 − 20% = ₹5,600
- Labour: ₹18,000
- Paint: ₹12,000
- Coolant: ₹1,500 (necessary after radiator/condenser replacement)
- Engine oil: nil (not accident-related)
- Wheel alignment: nil (no suspension damage reported)
- Front tyre: 40% worn → allow 60% = ₹3,900 (betterment for remaining tread)
Sub-total = ₹80,500. Less compulsory excess ₹1,000 and voluntary excess ₹2,000 = ₹77,500 payable. GST is not deducted because the insured is not GST-registered; if he were and claimed input credit, GST on parts/labour would be excluded.
2. Explain how you would decide between repairing and replacing the bonnet, and how the old bumper crack affects the assessment.
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First compare net cost. Repairing the bonnet costs ₹18,000 plus the same paint operation; replacing it would cost ₹28,000 less 20% depreciation = ₹22,400 plus paint. Repair is cheaper and the surveyor has confirmed it can restore original shape. The decision is not only cost: check the manufacturer's repair limits, whether the bonnet is creased at the hinge or stretched, and whether corrosion protection can be restored. If repair is technically sound, allow repair; if not, replace and apply 20% depreciation. The old bumper crack is pre-existing damage. Because the bumper is being replaced for the accident, the crack does not increase the replacement cost, but the insured is getting a new bumper; the 50% plastic depreciation already accounts for betterment. If the crack was severe enough that the bumper needed replacement anyway, the insurer should deduct the cost attributable to the old damage or treat the bumper as a 'due for replacement' item and apply higher betterment. Photograph and record the old crack in the survey report.
3. List the documents and observations you would record before signing the survey report.
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Record: claim form; policy copy and premium receipt; RC and driving licence; FIR or police intimation (needed here because government property-the divider-was damaged); dealer estimate and itemised invoice; photographs of the damaged parts, the old bumper crack, tyre tread depth, and the bonnet repair area; vehicle inspection report; confirmation that there is no suspension damage; GST registration status; satisfaction voucher; subrogation letter if recovery is possible from a third party; and payment receipt. Also note the odometer reading, fuel level, and whether the vehicle was driveable, because these support the damage mechanism.