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NISM Certifications · NISM-Series-X-B: Investment Adviser (Level 2) · Non-Life Insurance Products

Under a standard motor 'own damage' policy in India, the Insured Declared Value (IDV) of a private car is generally based on which of the following?

IDV of a private car is the manufacturer's listed selling price at policy inception less depreciation according to the vehicle's age. It is not the original purchase price or loan balance, and it represents the maximum payable in case of total loss or theft.

  1. AManufacturer's listed selling price of the vehicle less depreciation as per the age of the vehicleCorrect
  2. BOriginal purchase price paid by the owner with no reduction
  3. CThe cost of the cheapest comparable vehicle on the market
  4. DThe amount of the loan outstanding on the vehicle

Explanation

IDV is the manufacturer's listed selling price on the date of policy inception minus depreciation based on vehicle age. It is not the original price paid without adjustment, and it is unrelated to any loan outstanding. IDV is the maximum sum payable on total loss or theft.

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