As per Motor Vehicles Act, 1988, it is mandatory for car owners to have a third-party motor insurance policy.
You have finally bought your dream vehicle, and now you need to take certain measures to protect it. The first step is purchasing a car insurance policy. As per Motor Vehicles Act, 1988, it is mandatory for car owners to have a third-party motor insurance policy. A comprehensive car insurance policy offers car owners much-needed financial protection against untoward incidents. It provides coverage against natural and manmade calamities such as riots, strikes, floods, earthquakes, theft, and vandalism. The owner may also gain protection against bodily injuries, death, as well as damage to property.
With a plethora of car insurance policies with as many motor insurance providers in the market, choosing the one that fits your needs at the most competitive price may be a daunting task. Keep the following five tips in mind to buy a car insurance cover for your vehicle at competitive prices.
1) Choose Your Car Insurance Carefully
Before you buy car insurance online, it is imperative to do your due diligence. Do a thorough research of the various car insurance policies by checking the features and benefits against the price charged by the car insurance provider. Once this box is ticked, you can check other aspects such as premium payment methods, claims settlement ratio of the car insurance company, the procedure for making motor insurance claims, and reputation of the car insurance provider.
Online car insurance distribution channels might be cheaper than traditional offline methods due to elimination or reduction of paperwork. This means that motor insurance companies might pass down cost benefits to you, allowing you to enjoy lower car insurance premium rates.
2) Avail Of No Claim Bonus (NCB)
An NCB is awarded to car insurance policyholders who did not make any motor insurance claims in the previous policy year. Simply put, this is a way for car insurance companies to reward car owners for good driving. This reward enables you to become
eligible for discounts at the time of subsequent car insurance renewal. For example, if you did not make any car insurance claim in the first year of the policy, at the time of renewing your motor insurance policy in the following year, you may have to pay a lower premium towards your motor insurance policy as a result of the NCB benefit.
You can get discounts between 20 per cent and 50 per cent if no claims are made over one or more years. This is applicable even if you switch the car insurance provider at the time of renewal. This lets you save a significant amount of money on your car insurance renewal. A tip on getting complete benefits of this feature is to avoid filing for small car insurance claims as you may seek a higher NCB in the long run. One thing that you must keep in mind is that NCB is transferable from one vehicle to another, therefore you are likely to enjoy lower car insurance premiums for your new vehicle too.
3) Opt for deductibles
Opting for deductibles reduces your motor insurance premium amount significantly. A deductible is an out-of-pocket expense payable at the time of making a motor insurance claim. For example, if you opt for a deductible of INR 5,000, and the repair expenses are to the tune of INR 20,000, you are required to only pay the initial amount of INR 5,000, while the motor insurance provider pays the rest. Although it is true that deductibles lower your car insurance premium, do not opt for a deductible more than what you can comfortably afford. Otherwise, this may defeat the entire purpose of purchasing a car insurance policy.
4) Enjoy Discounts
You may enjoy additional discounts on car insurance premiums by becoming members of certain automobile organisations such as the Western India Automobile Association (WIAA) and Automobile Association of India.
As far as add-ons are concerned, you may consider choosing your car insurance riders decisively. Though riders offer more coverage over your basic car insurance policy, they come at an additional price. Some of the most common riders associated with car insurance include zero depreciation, daily cash allowance cover, roadside assistance and NCB protect. You may assess all of the options and purchase those that are applicable to you.
5) Renew Your Motor Insurance Policy Before It Lapses
A failure to renew your car insurance policy on time might result in a policy lapse. Not only will you lose the benefits in case of an unfortunate event, but you will also be deprived of discounts and benefits that you would have otherwise been eligible for. For example, you may miss the NCB benefit accumulated over the years, and, as a result, pay higher motor insurance premiums. In order to continue enjoying benefits, renew your car insurance policy on a timely basis. You could update your contact details with the company so that you get car insurance renewal alerts on time.
Some other ways of reducing your car insurance premium include choosing a higher policy tenure and maintaining a good driving record. If you have insurance policies in other categories, say health insurance, you may approach the same provider and request for a discount as a loyalty reward. These tips will go a long way in helping you buy the best car insurance in India.
Authored article by Vijay Sinha, MD & CEO of COCO by DHFL General Insurance