Purchasing car insurance can be difficult in itself unless customers are adept at selecting the correct coverage for their vehicles. In case vehicle is less than five years old, then search for persistent car insurance representative trying to sell their insurance policies.
Getting car insurance quotes online is also a good idea to deal with increasing premium level.
Basically, policies provided by car insurance companies in India can be mainly differentiated into two segments:
-
Comprehensive Plan
Generally, this is preferred options by many as it includes for both third party legal liability and accidental death. Also, it includes damage and theft caused by unforeseen perils such as earthquake, cyclone, fire explosions etc.
-
Third Party Liability Insurance
Usually, it includes accidental death, injury to a third party and property damage. Also, this policy is compulsory for each vehicle plying on Indian public streets.
Factors that affect Auto Insurance Premiums
Below mentioned factors affecting premium calculations depend on the risks which car insurance agencies will be underwriting and it can be grouped under four different segments:
-
Driver Related
Driver’s age is considered by car insurance agencies while deciding the premium. In case there is more than one driver, then the premium amount goes up.
-
Claim History Related
If policyholder claims for his insurance policy, then premium amount can increase in the following year.
-
Vehicle related Risks
Cubic capacity, type of fuel, model and manufacturer are some of the few parameters which will calculate the premium. Commercial vehicles and sports utility vehicles often require higher premiums as car insurance companies in India get maximum number of claims on these types of vehicles.
-
Location related Risks
These risks are based on the vehicle registration area. Premiums are high for those who live in urban localities. In case risk of theft is more in the policyholder’s area, then the premiums go up.
Tips to Decrease Car Insurance Costs
-
No Claim Bonus
Decrease premium amount by around 50% per year, only if policyholders don’t claim on vehicle insurance. Insurers give no claim bonus as record of good driving year after year.
-
Voluntary Deductibles
Deductibles are the amounts over which a claim is payable by insurer. If auto owner is willing to settle small claims for minor damages from his pocket voluntarily, then the car insurance cost can be decreased by certain amount.
