Thats the case with Third Party Insurance almost all over the world. Nothing new about it.
It goes like:

Brand New Car : No charges for Spare Parts.

1 Year Old Car : 10% of Spare Parts.

2 Years Old Car: 20% of Spare Parts.

3 Years Old Car: 30% of Spare Parts.

4 Years Old Car: 40% of Spare Parts.

5 Years Old Car: 50% of Spare Parts.
Onwards, no more deduction than 50% of the Spare Parts.

------------------------------------------------------Whenever I find the Key to Success, Someone Steals it.