I dont think this is correct. in the event of Total Loss, IDV is paid in full if one has a zero dep policy else (IDV - depreciation) is paid for normal policies. theres no market value involved here as the depreciation is calculated as per IRDA norms. Infact it is mentioned clearly in the policy that IDV will be treated as market value in the event of Total Loss. There is another category known as Net off Salvage(NOS). Vehicle is classified as NOS if estimated repair charges (insured's share) are less than 75% of IDV. Here the vehicle is sold by the insurance company to scrap dealers/garages. the salvage amt is paid separately and balance of the agreed amount is paid by the Insurance company. Here we can say that market value may come in picture indirectly in deciding the agreed amount.