What is RTI in Car Insurance
Return to Invoice cover is an add-on cover offered in a comprehensive car insurance plan. Same allows the insured customer to receive full compensation, i.e. the last complete invoice value of their car, in case it has been stolen or total loss.
Who can opt for RTI cover in car insurance?
A Return to Invoice cover is an exclusive add on cover offered along with Private Car Package policy or Private Car Standalone Own Damage Policy.
How does Return to Invoice cover work?
In a normal car insurance cover, the maximum amount of claim you can get is restricted to its IDV of the car. Return To Invoice is an add-on option which covers the gap between the Insured Declared Value (IDV) and the invoice value of the car. For context, the IDV is lesser than the invoice value of your car because of depreciation that happens over years. Sounds like Greek and Latin to you?
Basically, the coolest thing about this add-on is that it fetches you the on-road price of the car; the price you’ve paid for your car and doesn’t account for any depreciation! And perhaps this can almost make you feel good about your car if it is stolen or in case of total loss. (Well, we did say “almost”! 🙁)
When is RTI Applicable?
Return to Invoice is NOT an option you can claim to compensate for small blemishes and repair bills, like the last dent in your car or the crack on your windshield.
In fact, partial loss can be handled through Own Damage Cover and other add-ons like ‘Zero Depreciation’, whereas Return to Invoice helps you recover financial losses that arise because of a stolen car or a car damaged beyond repair i.e., when you’ve suffered a Total loss of your car.
How do you Calculate it?
When you buy a car, you will be paying for the ‘On-Road’ Price which insured has incurred. This will include the Ex-Showroom Price Plus the Road Tax which insured has incurred. And then to top it off, the insurance cost, Registration Charges depending on the class / make of the car. Phew! After all those payments, when your car is totaled, you get back a lesser amount than what you initially paid based on your IDV! We agree, it’s pretty unfair.
This is why, on this add-on cover, your IDV is the same as the ‘On-Road’ price (a.k.a. the total of all those additional things you paid). In other words, when your car is stolen or damaged beyond repair, you get the original price you paid while buying it, as compensation.
And where does Digit come into this?
We know that the add-on cover already sounds pretty cool and you would ideally like to know what Digit offers as part of our Return to Invoice cover. We shall pay the cost of a new vehicle of the same or equivalent make, model, features, specification of the Insured Vehicle subject to the price mentioned in the invoice of the insured vehicle.;
If the exact same make, model, variant is discontinued, we shall compensate with the last available invoice price of the Insured Vehicle immediately before discontinuation.
What’s great about a Return to Invoice Cover?
A Return to Invoice cover is best suited, to protect and compensate you in case your vehicle is stolen or damaged beyond repair.
You should opt for a Return to Invoice cover if you stay in a city or area that is prone to thefts. This way, your motor insurance plan will provide you complete protection in any possible case.
Generally, when you make a claim in any type of motor insurance, the amount you’re compensated for also accounts for your vehicle's depreciation too. However, if one has opted for this add-on cover in the plan, no depreciation would be accounted for and you will only get compensation based on the last invoice value of your vehicle.
When is the Return to Invoice Cover not Applicable?
The Return to Invoice Cover is not applicable in the following situations:
If your vehicle is damaged, but only to an extent where it can still be repaired.
If you claim that your vehicle is stolen, but don’t have an FIR or police complaint towards the same to confirm the same. You will need to support your claim with relevant documents.
Advantages of a Return to Invoice Cover
Enhances your car insurance plan by giving your vehicle better protection from total damage or theft.
It protects your pocket against losses that you incur as and when your vehicle is unfortunately stolen. This is because, as a benefit of a return to invoice cover, your insurer will compensate for your car as per the last invoice value, without considering any depreciation and, also accounting for its road tax when you buy your new vehicle again.
In case your vehicle is damaged to a point where repair is not possible, then your return to invoice cover will help you get the same or similar model of the vehicle, at the last invoice value of the same.
Explain it like I'm five
We're making insurance so simple, now even 5-year-olds can understand it.
A dad has promised his kid a pizza, and they visit a pizza shop to buy him one. The kid selects one for Rs.300, but then goes on to add extra toppings which increases the price to Rs.450. The child eats two slices and gets the rest packed to take home. As the child rushes out in a hurry to meet his dad, the pizza falls from his hand. He’s very disappointed. His dad agrees to buy another pizza for him,and gives him the full Rs.450 instead of Rs.300, so that the kid can buy the entire pizza with his favourite toppings all over again. The dad just Returned to Invoice (RTI) with the pizza.