Ways To Reduce the Premium of a Car Insurance Policy
Updated On Oct 15, 2023
Car insurance premiums are becoming increasingly expensive, especially after the Indian government has made thirty-party insurance cover mandatory for cars to run on the road. This has made the best insurance at rock bottom premium’ a thing of the past.
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Car insurance premium includes three major components - third-party liability premium, Own damage cover premium, and Personal accident cover premium + Additional covers. Third-party liability premium is stipulated by the Insurance Regulatory and Development Authority of India (IRDAI). The own-damage premium on the basis of different parameters like make, model, variant of the car, IDv, RTO location, fuel type, etc.
How to Reduce Premium of a Car Insurance Policy?
Everybody wants to save money. It is essential that you search all the available insurance policies in the market before selecting them. The lower the premium, the more money you save. We have listed a few ways in which you can in short to reduce the premium that you pay for a car insurance policy.
Compare Car Insurance
Before purchasing car insurance, always compare the coverage and premium quotes offered by various insurance companies. You can do this easily by visiting InsuranceDekho. Comparison of car insurance plans helps you know the coverage offered by different plans and their premium amounts. This knowledge helps you to make the right and informed decision easily and instantly.
Be Wise With Coverage
An automobile insurance policy is usually a predefined set of advantages. Nevertheless, if your policy permits, then cop-out of features you are doing not actually need. This helps lower the automobile insurance premium to some extent.
Avoid Making Small Claims
While it's true that the core purpose of automobile insurance is to save lots of expenses incurred for repairing a damaged vehicle, making very small claims could work against this objective. Even for the littlest claim, you create, you lose the distinct advantage of the No Claim Bonus (NCB) – the bonus accrued for each consecutive claim-free year over the policy term. The NCB can lower your automobile insurance premium up to a maximum of 50%; so, your next year’s premium sees a 50% dip. The claimed amount is usually lesser than the entire processing charge and therefore the loss of NCB. The wisest thanks to using your insurance are to get small repairs at local workshops. The dual advantage is that the expenses are lesser and therefore the NCB is saved too. Keep in mind that if the repair amount is lesser than the NCB, then you'll potentially accumulate, refrain from making a claim.
An advantage of not making a claim is that the bonus accumulated is transferable to the new car you buy. It is, therefore, knowing to retain the insurance in your name even after selling your vehicle and ask the insurer to offer you the no-claim certificate. You can reserve this bonus albeit you're not immediately buying a replacement vehicle. Whenever you purchase a replacement car, transfer the prevailing policy thereto and carry over the no-claim bonus accrued over the years. This will assist you to reduce the automobile insurance premium rate for the new policy.
Install ARAI-approved Anti-theft Devices
You can also get a discount by adding ARAI-approved anti-theft devices in your car as this reduces the probability of car theft and thus the insurance company’s chances of meeting the liability.
There are a number of ways in which you can reduce the premium of your car insurance policy. We hope this list helped you in knowing some of the easiest hacks for getting a cheaper car insurance policy. Always compare car insurance plans so that you can make an informed decision without the influence of any agent.
Disclaimer: 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.