Buying a new car involves arranging the finances for its purchased followed by the registration requirement and the insurance. Once the financing for your car is sorted, you need to get it registered as it forms a legal requirement to drive any vehicle in the country. The registration is something that your auto dealer will help you through, but insurance is what you must look into thoroughly.
Generally, dealers offer a couple of car insurance plans when you purchase your car, but they are often not up to the mark, either in terms of coverage or in terms of the benefits they offer. Hence, selecting a plan that checks all the right boxes is critical. In this process, it is important to keep in mind that there needs to be a balance between the premiums and the policy features. At either extreme, it is not a healthy place to be. To help you keep your premium in check, this article elucidates some nifty tips that can be used. Continue reading to know more.
- Comparing different plans
Comparing the plans is the starting point to have a pocket-friendly insurance policy. When comparing it is essential to not just look at premium as a factor, but also the coverage a plan offers. Making such an informed choice will help you to buy a plan that is not only has affordable car insurance prices, but also comprehensive insurance coverage. *
- Increasing the deductible component
Using the deductible can be a smart way to ensure the premium is within check. Deductible is that component which you, the policyholder, are required to pay before the insurance coverage kicks in. Every policy has mandatory deductible while the voluntary deductible, as its name suggests, is optional. You can opt for such voluntary deductible that increases the out-of-pocket expense at the time of claim bringing down the premium amount. There is an inverse relationship of premium with respect to the voluntary deductible of your policy. *
- Avoiding claims for minor damages
Another convenient way to lower the insurance premium is not making claims for small repairs. Insurance companies offer a bonus at the time of renewal for every claim-free policy period. This is called as the no-claim bonus and it has an effect of lowering the insurance premium. The amount of such bonus starts at 20% and scales all the way up to 50% based on each consecutive claim-free period. So, any claim made for a minor repair has the effect of giving up such renewal benefit and must be avoided to save premium in the long run. For determining which repairs to be taken up with the insurance company, you must compare these no-claim benefits along with the deductibles of your policy helping you decide the benefit to be foregone and the out-of-pocket expense to be paid. *
- Transferring the no-claim bonus
No-claim bonus is a feature in comprehensive plans that helps to lower the burden of premium during renewal. While most buyers are aware of the no-claim bonus, very few are aware that it is attached to the policyholder and it can be transferred. Thus, even if you sell your vehicle, you can still carry forward the accumulated no-claim bonus to your new car’s insurance cover. You can visit the official website of IRDAI for further details. *
* Standard T&C Apply
These are some useful tips that can help you lower the premium of your policy. While you are at it, make sure to check out the car insurance calculator that helps to determine how much premium shall be required. Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms and conditions, please read sales brochure/policy wording carefully before concluding a sale.