For most, a car is a prized possession that is treated with utmost care to avoid any dents and scratches. A lot of individuals will even opt for a comprehensive insurance policy to secure their vehicle from unfortunate mishaps. But are you aware of the factors that play a role in deciding your premium? Some of these aspects can be controlled, and some not so much! So, let’s go through the several elements that determine your car insurance policy
Factors That Decide the Car Insurance Quotes
Make and Model of Car
The model of your car will highly affect your premium quote of your policy. Luxurious cars will have higher car insurance quotes when compared to regular vehicles. Also, newly bought cars will take home a higher premium rate.
Another vital aspect is the fuel type of your car, which determine the premium price. Vehicles that run on diesel are more expensive when compared to cars that use petrol or CNG. Thus, car insurance quotes for diesel-run vehicles will be higher than others.
Age of your Vehicle
The age of your vehicle is the most important aspect because it decides the depreciation value. Due to natural wear and tear and ageing, assets lose its original value termed as depreciation. For insurance, this value determines the Insured Declared Value or IDV in insurance
, which is the current market rate of your car. In case your vehicle is old, the depreciation value will be higher, and the IDV will be lower, leading to a lower premium rate.
The city where you insure your vehicle also decides the car insurance policy quotes. Residing in major metro cities which are termed as Tier 1 means a higher premium rate when compared to Tier 2 or Tier 3 cities.
You will find two car insurance coverage types available, third-party insurance and comprehensive plan. The third-party insurance policy is mandatory if you want to drive legally. However, you can choose to purchase comprehensive insurance for extensive security which includes third-party cover. Depending on the policy you opt for, your premium shall vary where the comprehensive plan is more expensive than third-party insurance.
No Claim Bonus
You can enjoy the perks of No Claim Bonus or NCB if you do not make any claims during the policy year. The insurance provider will offer you a discount on your premium amount on renewal of the policy. The percentage of discount keeps increasing every year if you continue to maintain your NCB. The reward per cent starts from 20% and can go up to 50%. Thus, if you don’t file any claims, due to No Claim Bonus, your premium quote will be lesser than usual.
If you get a comprehensive insurance policy, you will be able to buy add-on covers for maximum coverage. These add-on covers secure certain aspects of your vehicle that are not covered by the insurance plan. Some popular covers are zero depreciation car insurance cover, consumables add-on, engine protect cover, return of invoice cover, NCB protect add-on, etc. You would have to pay an additional premium to combine these add-ons with your plan, thus, leading to higher car insurance quotes.
Voluntary Deductible is a percentage of the claim amount that the policyholder agrees to pay while filing a claim. This is a lucrative way of reducing your premium quote by opting for a voluntary deductible. The higher the deductible, the lower the premium shall be. But one thing to keep in mind is that this amount will go from your own pocket at the time of claim and thus, you should choose the percentage wisely.
With this, you are now aware of the factors that play a significant role in deciding the car insurance quotation. Thus, you can opt for an affordable premium with the above aspects. You can use the reference ID in order to retrieve car insurance quotes computed previously or find the same using an online car insurance premium calculator