What is Return to Invoice in Car Insurance?

Buying a new car is quite an investment, and protecting your investment is critical too. If you find yourself asking what is return to invoice in car insurance, it is a unique add-on cover that pays you the total invoice value of the car if that vehicle is stolen or written off. 

This cover pays the difference between the current depreciated value of your vehicle, and your original purchase price. For example, you will receive the total amount on your vehicle purchase invoice - including registration and road tax - rather than a lower Incurred Declared Value (IDV).

How Does Return to Invoice Function in Car Insurance?

Once you purchase a car, and as soon as the vehicle leaves the dealership, you will incur depreciation on the car value. What does this mean? In most cases if your car is stolen or written off, your car insurance will cover you for the market value at that time. However, if you  return to invoice in car insurance, you may claim back the original invoice price, meaning you will not be out of pocket when you take depreciation into account and replace your car.

You would elect this optional benefit at the time of application for, or at renewal of, your comprehensive car insurance policy.

Explained: What Return to Invoice in Car Insurance Means for You

Return to invoice in car insurance means In terms of reimbursement, we will pay you the automobile's original invoice value, as opposed to the depreciated market value. That is, you will receive the total invoice value, tax value, as well as registration fees value. 

To illustrate, if your car was sold on an invoice value of ₹12 lakh but has a current IDV of ₹9 lakh after depreciation, the RTI cover will ensure you are paid, in the event of a total loss or theft, the ₹12 lakh = invoice value.

Benefits of Return to Invoice Cover in Car Insurance

Choosing a return to invoice cover in car insurance offers you added piece of mind and a higher level of protection in case of loss. Here’s why you should consider it:

• Full Reimbursement: You are reimbursed based on the actual invoice, not depreciated or current value.
• Covers Taxes and Fees: You will also receive the road tax and registration fees back in your claim.
• Perfect for New Cars: This is the best option for vehicles which are 3–5 years old.
• Protection from Financial Loss:  Provides you with protection from losses due to depreciation.

Return to Invoice Meaning in Car Insurance

The return to invoice meaning in car insurance is simple —It restores your financial situation to the moment you bought your car. This is great coverage to guarantee you would be made whole in the event that your car was stolen or deemed a total loss.

It only applies to total loss or accidents, and not partial damages or accidents that can be repaired. It only goes into effect when: 

• The car was deemed a total loss by the insurer.
• The car was stolen and never recovered.
• The car is typically 3-5 years old or younger.

When Should You Opt for RTI Cover?

If you do, you may want to add RTI cover if:

• You have a new or luxury vehicle.
• You have a high risk of theft or collision in your area.
• You financed or leased your vehicle.

For example, if your one-year-old car is worth approximately ₹10 note your price, and it gets stolen, if you did not have RTI you would have received approximately ₹8 note your price, by using IDV. However with RTI you receive the note your price of ₹10 including taxes and fees.

How to Add RTI Cover to Your Policy

Including coverage for RTI Insurance is quite simple. You can either enroll for a new comprehensive policy, or at the time of renewal for an existing comprehensive insurance policy. You may check for eligibility on your insurer's site or simply call a rep to confirm.

If you need an official description of add-ons related to car insurance for example, you can check the IRDAI official site — the Insurance Regulatory and Development Authority of India.

Conclusion

Understanding what is return to invoice in car insurance policy means is important when reviewing your options for coverage. Lots of policies have this return to invoice option as an add-on to the coverage for only a small additional cost, and helps to protect you from financial loss when life throws a curve ball.

Choosing the return to invoice in car insurance coverage protects your investment in your vehicle, and gives you peace of mind when driving, knowing your car's full value will be protected if the unimaginable happens.

Frequently Asked Questions (FAQ's)

1. Is Return to Invoice cover really necessary?

Yes. It’s especially beneficial for new cars, ensuring you recover the full value in case of theft or total damage.

2. Can I get RTI cover for an older car?

Usually, it’s offered for cars up to 3–5 years old, depending on the insurer.

3. Does RTI cover minor damages?

No. RTI applies only for total loss or theft, not for partial or repairable damages.

4. How much extra does RTI cost?

It slightly increases your premium but offers complete peace of mind and better protection.

5. Does RTI include accessories?

Some insurers include factory-fitted accessories; however, aftermarket ones may not be covered.