07 Factors that Define Car Insurance Premium

Gone are the days when buying car insurance was a tedious task. However, it is important to make an informed decision and hence, conduct thorough research. Good research will help you to understand the features, benefits, and exclusions offered under the product. With a plethora of car insurance companies in India, sometimes choosing the right car insurance plan might become a task. When it comes to car insurance premiums certain factors should be taken care of. Let us understand those factors that not only define the car insurance premium but also help to make the right decision.

Things that You Should Consider While Buying Car Insurance

Here is a rundown of the ten things that will help you to make a wise decision about buying a comprehensive car insurance policy:

1. Choose a Brand: Reminicize the time when you purchased your car. Or if you are in the process of buying a new one, then you would have done the research. Similarly, when it comes to buying four-wheeler insurance go with a provider, which has the best claim settlement ratio like ours. Besides, take a keen look over the features and benefits being offered within a plan. Do not go with the insurance company just because it offers a less car insurance premium.
2. Analyze the Requirement: Before you buy a car insurance plan you should switch on the introspection mode. Ask yourself whether you reside in an area that is prone to natural calamity. Or lately has there been any car theft in your locality? How regularly do you use the car? Questions, like these, will help you to understand your requirements. Moreover, you would be in a better position to choose the right car insurance coverage.
3. Buy Car Insurance Online: Buying car insurance online has its perks. It is helpful regarding convenience, pricing, and services. Moreover, buying insurance online will let you avail the benefits of the coverage at a special price compared to the offline channel.
4. Type of Plan: You might be aware that third-party car insurance is a mandate in our country. However, it is advisable to choose comprehensive car insurance online. Having an extensive plan will insure your vehicle against any eventuality such as theft, damage, etc.
5. Install Anti-theft Devices: Installing anti-theft devices like tracers, alarms, and so forth adds to the layer of security on the four-wheeler. By installing any such devices, the chances of car theft get reduced. Moreover, it also helps to reduce the four-wheeler insurance premium. However, make certain that the anti-theft tools have been validated by the Automotive Research Association of India.
6. Personal Accident Cover: Personal accident cover is a mandate for all vehicle owners. It helps to decrease the burden of finances for both car owners and drivers. It has been in effect since January 2019 as per the Motor Vehicles Act. Under it, when you have a personal accident cover, a waiver is offered to the car owners or drivers with the sum insured of Rs 15 lakh. Besides, having the personal accident cover in the policy for any existing vehicle, the driver or vehicle owner need not purchase a fresh insurance plan for a new vehicle.
7. Look for Add-on Cover: An add-on cover will enhance car insurance coverage. However, it is to be noted that for an add-on cover extra premium needs to be paid. This car insurance premium will differ from insurer to insurer depending on the requirements. Having an add-on cover does not imply that you are on some shopping spree. The golden rule is to understand the need and choose an add-on that is needed.
8. Voluntary Deductibles: You just need to convey to the insurance company that you will share the risk of insuring the car. Like this, the insurance company will consider reducing the premium. This is what voluntary deductible does. It means that you volunteer to pay a specific amount of the claim. Then in return, the insurer will reduce the car insurance premium. This will happen because the risk liability of the insurer also gets reduced.
9. No Claim Bonus: The No Claim Bonus is a benefit, that the policyholder gets from a car insurance policy. It is a discount on the yearly premium payment when no claim is filed in a year. While purchasing a car insurance policy, check with the insurer regarding the NCB.
10. Understand IDV: The IDV stands for Insured Declared Value. It is the maximum sum assured, which is fixed by the insurer. It is provided under total loss or theft of the vehicle. In simple words, the IDV is the present market value of the vehicle. So when the vehicle suffers a complete loss, IDV is the compensation provided to the policyholder by the insurer.

Wrapping it Up

By now, you are completely aware of the key considerations that should be kept in mind while purchasing car insurance in India. Purchase car insurance online only when it suits your requirements. Do not fall for gimmicks. In case of any questions, speak to customer support. Do not buy a car insurance policy simply for formality. Understand every facet of the product and make an informed decision by optimizing your needs.   *Standard T&C apply Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.