Ever since the government of India made third-party insurance coverage mandatory for cars, car insurance premiums have increased significantly. Besides this, factors like driving record, claim record and changes to payment structure also hike one’s insurance premiums significantly. Nonetheless, policy buyers can lower their car premium by availing discounts and following a few simple tips.
Ways to lower vehicle insurance premium
Here’s how policy buyers can lower their car insurance policy premium –
- Renew insurance plan on time
Failing to renew vehicle insurance policies before the expiry date or even post grace period often becomes the reason why vehicle owners have to purchase a new policy. This makes the entire process cumbersome and makes vehicle owners pay a higher sum to buy a new policy for their car.
- Set the accurate Insured Declared Value
Insured declared value is an approximate market value of the car in question. Vehicle owners must make it a point to set an accurate insured declared value without inflating or deflating it. A higher IDV tends to push the premium amount upwards. On the other hand, lower value impacts the claim amount negatively.
- Select a suitable car insurance policy
To avoid unnecessary expenses and save money on insurance premiums, vehicle owners should pick the correct type of policy, which is best suited to their needs.
In a broader sense, there are two types of vehicle insurance plans in India – comprehensive and third party car insurance policies. They should understand the coverage, limitation, and terms of each type of insurance policy claim before selecting a specific plan.
- Compare insurance policies online
By comparing insurance policies online, individuals can easily pick one that comes with affordable premiums. However, one must not select such a policy based on the premium amount alone. To make the most of a comprehensive motor insurance policy, individuals must check the extent of coverage, exclusions, claims process, co-payment percentage, etc., before selecting any policy.
Comparing online car insurance policies is probably one of the best ways of checking the accompanying features of leading plans in just a few minutes. Doing so also helps to select the most suitable option from the plethora of choices available.
- Become a member of the Automobile Association of India
Those who are a member of Automobile Association can qualify for a discount on vehicle insurance premium. All one needs to do is mention the membership while purchasing a car insurance policy.
- No Claim Bonus
Typically, a No Claim Bonus is a reward extended by insurance companies to policyholders for a claim-free year. One of the best ways to ensure that one can avail this bonus is by refraining from filing small claims for issues like dents on the car or broken tail light. This no claim bonus discount on policy premiums usually ranges from 20% to 50%. Individuals also have the option of transferring such accumulated benefits from one insurance company to another at the time of policy renewal.
- Opting for a higher voluntary excess
Voluntary deductible is another effective means of decreasing the 4 wheeler insurance policy premium. Typically, it is the excess amount above compulsory deductibles on vehicle insurance policies. A higher voluntary deductible excess helps lower policy cost but can have major financial repercussions. In case of accidents, policyholders would need to bear a significant portion of repair expenses from their own pocket before they can claim financial assistance from insurers.
Besides these, some insurance companies also extend a discount on car insurance premiums to professionals like chartered accounts, doctors, defence personnel, etc. Insurance providers may also extend a discount on premium service to individuals belonging to specific age groups.
Furthermore, vehicles that are protected with an anti-theft device may avail a discount on their insurance premium. By leveraging these factors, individuals can discount the 4 wheeler insurance premium amount and facilitate savings effectively.