In India, Car Insurance policies are a must for every driver. It helps protect your vehicle from financial emergencies and have beneficial features that help the insured during their hour of need.
Car Insurance prices aren't just numbers made up by the insurance providers. After carefully thought-out calculations and analysis, an insurance company makes an educated assertion on how likely you are to claim your Car Insurance policy.
Following are the 7 factors that decide your Car Insurance price:
1. Driver's Location
Insurers usually ask for your PIN code because that decides the base rates. If you live in a highly populated or an urban area the price of your policy is likely to be higher as there are chances of more accidents happening in and around your location.
2. Driver's Experience
A good combo of the number of experienced years and a clean driving record could get you better rates and discounts on your car insurance policy.
3. Insured Declared Value (IDV) of the vehicle
The Insured Declared Value (IDV) of your vehicle determines the premium you pay. The price of your car has a direct connection with your premium. If your car is expensive, it definitely shoots up your premium. Premium payment is also affected by the type of fuel your car uses, manufacturing date, date of registration and any expensive components used in the making of your car.
4. Robbery or theft
Some cars are more likely to be stolen than others. Car models that are included in the 'top ten most stolen list' tend to be pricier than those that are not in the list. Car alarm systems or other anti-theft features can lower the premium.
5. Driving history and activity
If you have a past record of accidents, you are likely to lose out on the reduction of your premium or any other applicable deductions.
6. Use of the vehicle
Premiums are given for personal as well as commercial vehicles. If the vehicle is used commercially, insurance companies charge a higher premium, given that it's a source of income.
Add-ons enhance the coverage offered by the Car Insurance policy. With each add-on that you purchase, the premium will increase. Some add-ons offered include consumable expenses, conveyance benefit and accident shield.
Car insurance companies can calculate your premium plan within a few seconds, using the car insurance calculator online. They also offer value added services like 24x7 spot assistance, lock and key replacement cover, own damage cover and zero depreciation cover.
Your favourite vehicle, however simple or advanced it might be, will bear certain amount of risk. Therefore, along with owning a vehicle, the idea of its insurance must be carefully planned as well!
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