9 Simple Tips to Save on Your Car Insurance Premium

Though having comprehensive car insurance coverage is necessary, it can cost you, the car owner, a pretty penny. In this article we are going to discuss nine tips that will help you save on the premium when buying or renewing your car insurance:

1. Know your requirements:

Choose a plan that matches your requirement, and do not base your decision solely on the premium. As discussed, there are two types of car insurance available in India. Third-party car insurance financially protects you against any third-party damage, loss of property, death or physical injury caused to the third party. Comprehensive Car Insurance gives you all the benefits of the third-party insurance as well as protection to you and your vehicle.

As per law, only third-party car insurance is mandatory, but if you want to secure your vehicle from any unforeseen events, comprehensive car insurance can fulfil your insurance needs.

2. Shop around:

Once you understand your insurance needs and finalise the type of plan, compare the available plans. Many general insurance companies in India offer a wide range of motor insurance options to car owners. Before purchasing a motor insurance policy, thoroughly research each option by checking the coverage benefits, terms & conditions, and comparing the premiums of various insurers. Many websites let you compare the different insurers online; the premiums vary based on the type of insurance policy and the coverage it provides. So when comparing premiums, it is advisable to compare the same types of policies that offer the same coverage benefits.

3. Opt for higher deductible:

A deductible is a percentage of the total claim amount you are obligated to pay whenever you file a claim and the insurance company settles the remaining dues. For e.g., when an unfortunate event occurs, and your car insurance policy has a fixed deductible of 5%. After assessing the damages, you file a cashless claim for Rs 50,000. Once you make a claim, the insurer intimates you to pay Rs 2500, the deductible. After you have paid the deductible, the insurer will settle the remaining amount, i.e. Rs 47,500, directly with the service center / garage.

Car Insurance Deductible is beneficial to policyholders because it reduces your insurance premium amount considerably. Higher the deductible, lower the premium. Therefore, many people opt for a higher deductible in order to reduce the car insurance premium. Besides, it is beneficial to the insurance company as it discourages policyholders from making small claims.

4. Check for the riders/add-ons:

A comprehensive car insurance plan can buffer you with riders or add-ons, additional coverage options that you can buy by paying more. When you buy these riders, you are insured against specific damages that are not included in the base plan. You can check online the list of add-ons and the extra premium you need to pay for it and choose the ones that match your requirements. Not opting for unnecessary riders and add-ons can save a considerable amount of your premium. On the other hand, opting for the right riders and add-ons will save you money in case of an unfortunate event.

5. Take benefit of NCB:

If you do not make any claim during a policy year, the insurance company is entitled to give you a No Claim Bonus (NCB), which is approximately 20% of the premium you paid. Hence, The NCB starts in the second year and can go up to 5 years. So, when you renew your car insurance policy, the insurer offers you the NCB discount you have earned during the previous policy years. You can earn and accumulate up to 50% NCB discount. Moreover, you can use your accumulated NCB even if you change the insurer or transfer it to the new owner in case you sell the vehicle.

6. Install safety devices:

Using safety devices in the vehicle can minimise the chance of major damage in an accident. Installing safety devices in your car can substantially reduce the car insurance premium. However, installing expensive premium accessories and gadgets will in turn increase the premium.

7. Timely renew the policy:

If you do not renew your car insurance policy on time and it gets lapsed, you will lose all the accumulated benefits. Therefore, it is advisable to pay the premium and renew the policy on time. In order to not miss the renewal, many insurance companies provide the facility of auto-renewal. This means, every year the motor insurance policy will get automatically renewed and the premium will get deducted from your registered payment method. You can also renew the policy online from the comfort of your home within a few minutes.

8. Ask for Offers/Discounts:

Insurance companies generally have discounts/offers time-to-time. You should keep an eye on the discount codes or ask the company directly if they are offering any discounts. Buying car insurance at some discount can save a pretty penny. But, make sure you do not postpone buying insurance or renewing it for saving a small amount as not buying/renewing the car on time can lead to a higher premium later.

9. Buy multi-car insurance:

If you have multiple vehicles, it is a good idea to buy a multi-car insurance policy. Since you insure many vehicles at the same time from the same insurer, you get the discounted rate in a multi-car insurance plan.

To Conclude:

Consider these 9 tips and make an informed decision when you buy a car insurance premium. Focusing only low premiums and buying the minimum required coverage will not serve the purpose of buying insurance when it is time to file a claim. Therefore, it is best not to compromise on paying for adequate coverage and necessary required add-ons while saving on the premium amount.

Warm Regards,
Ketki Jadhav
Content Writer

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