Compare & Buy Car, Bike and Health Insurance Online - InsuranceDekho
Claim, renew, manage & moreLogin

5 Ways to Save Money on Car Insurance in your 20s

Written by Sharad Bajaj
Updated On Oct 14, 20232 min read

Here is how you can start saving big on your car insurance from early age!

You have bought your dream car in your 20s after saving for several years. Congratulations on that! But the time is approaching when you would be requiring a good insurance policy for your car. Buying a car insurance policy might be a liability for you, but this is something which you really need for safeguarding your car as well as for protecting yourself or a third party from the damages or injuries associated with car accidents or any other unfortunate event. Moreover, the Indian Motor Tariff, 2002 mandates that all car owners must have a third party/liability only car insurance policy.

The premium for a third party insurance policy is relatively cheaper than the comprehensive one. However, in the former, one can get insurance only for bodily injuries or death of a third party along with a cover of up to Rs. 7.5 lakh for third party property damage. Whereas, the latter insures you against own damage (OD) incurred by your car in addition to all the third party liabilities for a higher premium.

When you are in your 20s, it’s quite probable that you have not made enough savings. It is a time of self-discovery and a ripe age to grow and to take your aims and plans further. You have just started your career and it is quite likely that you have thoughts of spending money in an attempt to fulfil your bucket list - buying a car being one of them. Thus, spending in an optimal manner in this age becomes all the more important. Thus, we bring to you the top 5 ways in which you can make the most of your money while buying an insurance cover for your car.


5 Ways To Save Money on Car Insurance in your 20s

The good news is that there are several discounts which you can avail on your car insurance policy. Below are some quick tips using which you can save money on your car insurance during your 20s.

#1: Always Transfer Your No Claim Bonus

It is not at all a smart option to claim for every petty damage caused to your car, even though you do not have a limit on the number of claims you can file. Grow a habit of not claiming insurance for minor damage like scratches. This is because, a policyholder gets a No Claim Bonus (NCB) as a reward for not filing any claim against car damages during the validity period of the policy. You can use this as a discount on your next car insurance policy. NCB is available up to 50% on the own-damage premium.

Below is a table which explains how much NCB a policyholder can get (As per IRDAI):

Claim Free Years

NCB Percentage

1 Year


2 Years


3 Years


4 Years


5 Years


#2: Get Anti-theft Devices Discount

Try installing anti-theft devices that are authorised and approved by the Automobile Regulatory Authority of India (ARAI). This would fetch you additional discounts of up to 2.5% (which makes up for a discount amount of up to Rs. 500) while buying an own-damage car insurance policy. The reason for such a discount plan is that putting these anti-theft devices into your car would make it less vulnerable to any attempts of theft or other such risks. This would, therefore, lessen the risk that is borne by your insurance company for your vehicle, thus being able to provide you with extra discounts on the overall premium value.

#3: AAI or Automobile Association of India Membership Discount

If you have a membership of the Automobile Association of India, you would be eligible for getting a discount on your car insurance premium. While purchasing a car insurance plan, you simply need to mention your AAI membership, which is very easy to get these days.

#4: Compare Several Policies And Go For The One That Suits Your Needs

At the time of issuing an insurance cover, make sure that your insurance company provides you with a correct IDV or Insured Declared Value. It is basically the current market value of your car that your insurance company will reimburse in case your car suffers a total loss or theft. Make sure that your insurance company is providing you with a suitable insurance plan that would suit your financial and personal needs well. To get a free quote and compare several insurance policies, visit our platform InsuranceDekho which lets you get a car insurance policy in just 5 minutes.

#5: Maintain a Good Credit History

Maintaining good credit history is beneficial not only while getting a loan but also for getting good discounts on your car insurance premium. Having a good repayment history and a high CIBIL score would lower your insurance costs, as insurance companies use this score while calculating your insurance premium amount. Also, it is a proven fact that people with good credit history file fewer claims. Abstain from making random expenses, especially while you are in your 20s.

The above tips can be beneficial for you while getting a car insurance discount, it is also advised that you go keep following the website or other web portals of your insurance company for any updates on additional discounts or offers.

For further reading:

Which Insurance Company Provides the Cheapest Car Insurance In India?

Disclaimer: This article is issued in general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.


This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.
Author Image
Written by Sharad Bajaj
View Author

 Sharad is an insurance industry veteran who has managed motor insurance products for over a decade. He helped set up and scale the motor insurance vertical for a leading insurance company in his previous stint. In his spare time, Sharad likes to read and be in tune with nature.

Explore more before buying Car Insurance

    must dotmust graphics

    Why to buy from InsuranceDekho?

    • Instant policy # within 5 mins
    • More than 45 Lac happy customers
    • Claim Support available all 7 days of the week

    People Also Read