0 Dep Insurance for High-Mileage Vehicles: Is It Possible?

The automotive industry is undergoing a massive transformation, with electric vehicles (EVs), autonomous driving tech, and sustainability initiatives dominating headlines. Yet, one segment often overlooked is high-mileage vehicles—cars that have clocked over 100,000 miles or more. These workhorses of the road face unique challenges, especially when it comes to insurance.

Traditional auto insurance policies often penalize high-mileage vehicles with higher premiums or limited coverage options. But what if there was a way to offer 0 depreciation (0 dep) insurance for these vehicles? Could insurers adapt their models to accommodate older, high-mileage cars without passing excessive costs to consumers?

The High-Mileage Vehicle Dilemma

Why High-Mileage Cars Are Different

High-mileage vehicles are typically older models that have been driven extensively. While they may still be reliable, insurers view them as higher risks due to:

• Increased wear and tear – More miles mean more chances for mechanical failures.
• Lower resale value – Depreciation hits these cars harder, making claims more expensive relative to the car’s worth.
• Higher likelihood of breakdowns – Older engines and transmissions are more prone to issues.

Because of these factors, many insurers either charge significantly higher premiums or exclude certain coverages altogether.

The Rise of 0 Depreciation Insurance

0 dep insurance, popular in markets like India and parts of Europe, covers the full insured declared value (IDV) of a car without accounting for depreciation. This means that in case of an accident, the policyholder gets a full replacement or repair cost, not a depreciated amount.

But here’s the catch—0 dep insurance is usually reserved for new or low-mileage cars. Extending this to high-mileage vehicles would require a fundamental shift in risk assessment.

Can 0 Dep Insurance Work for High-Mileage Cars?

Challenges to Overcome

1. Risk Assessment Models Need Updating

   • Current actuarial models heavily favor newer cars.
   • Insurers would need real-time data on vehicle condition, not just mileage.

2. Higher Claim Probabilities

   • Older cars are more likely to need repairs after accidents.
   • Fraud risks could increase if policyholders exploit full-value claims.

3. Cost vs. Affordability

   • If insurers charge too much, drivers won’t buy it.
   • If premiums are too low, insurers risk unsustainable losses.

Potential Solutions

• Usage-Based Insurance (UBI) – Telematics can track driving behavior and vehicle health, allowing fairer pricing.
• Condition-Based Policies – Regular inspections could determine coverage eligibility.
• Tiered Coverage – Offer partial 0 dep benefits based on mileage brackets.

The Future of High-Mileage Vehicle Insurance

As the world shifts toward sustainability, keeping older cars on the road longer aligns with reducing waste. If insurers can innovate with 0 dep policies for high-mileage vehicles, it could:

• Encourage longer car ownership – Reducing the environmental impact of manufacturing new vehicles.
• Provide fairer insurance options – Helping budget-conscious drivers maintain coverage.
• Drive telematics adoption – More accurate data means better risk models.

The idea isn’t far-fetched. With advancements in AI, IoT, and predictive analytics, insurers could soon offer customized, depreciation-free coverage for even the most well-traveled cars. The question isn’t if it’s possible—it’s when it will happen.