A recent debate over ICICI Lombard’s stance on claims involving the use of E20 fuel in non-compliant vehicles has gained significant attention in recent days. However, the insurer later clarified that these concerns are unfounded, stating that such vehicles continue to be covered under its policies. Nevertheless, if you’re also looking for comprehensive car insurance that offers extensive coverage and real peace of mind, you’re in the right place. In this guide, we share practical tips to help you secure the best comprehensive insurance policy for your vehicle, without breaking the bank. But first, let’s understand what factors affect the insurance premium: –
Aspects That Determine Car Insurance Premium
- Vehicle Age: This plays a crucial role in determining the insurance premium. That said, premiums for new vehicles are generally higher because they undergo little to no depreciation, whereas premiums for older cars are lower.
- Insured Declared Value (IDV): IDV represents the maximum sum insured and the current market value of your vehicle. A higher IDV ensures better compensation in case of total loss or theft. That’s why the higher IDV attracts a higher premium.
- Make, Model & Variant: Luxury & premium vehicles like BMW X5, Mercedes S-Class, and Audi Q5 have higher insurance costs than budget offerings like Maruti Alto or Hyundai i10. This is because their repair and maintenance costs are high.
- Area of Registration: Geographical location is again an important factor to determine premiums as it indicates the statistical risk of theft, accidents, and weather damage, etc. That said, areas with higher accidental rates, theft risks or natural disasters may have higher premiums.
- Type of Coverage and Add-on Covers: A comprehensive policy commands a higher premium than a third-party only policy because it provides extensive own-damage protection. Furthermore, additional covers such as zero depreciation, engine protection, personal/passenger accident coverage, roadside assistance, etc., elevate the overall premium.
- Upgrades, Customisation, and Conversions: Non-factory or aftermarket changes and customisation, such as performance upgrades, CNG/LPG kit fitment, or cosmetic changes, can increase your car’s premium, as they may raise the vehicle’s risk profile and repair costs. However, vehicles equipped with anti-theft or GPS devices command lower premiums than those without them.
- Claim History: Vehicles with frequent claims may attract higher premiums, whereas vehicles with no claims qualify for a no-claim bonus, which reduces the total premium.
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Simple Hacks To Save Money On Car Insurance
- Compare Policies Extensively: Use online platforms to compare policies from various providers so that you can get a better idea of the policy benefits, features and premiums to secure the best deal for you.
- Utilise Your No Claim Bonus (NCB): Insurers offer a no-claim bonus (NCB) on your policy. So, if you haven’t made any claims during the previous policy term, you will be eligible to opt for the NCB. This reward typically starts at 20% on one claim-free year and increases to a maximum to 50% over time. What’s more important is that the NCB applies to the vehicle, not to the policyholder, which means it is transferable in case of selling a used car.
- Stay Covered: Always keep your policy active to avoid policy lapse, which can cause to higher premiums while renewing or purchasing a new policy.
- Avoid Unnecessary Add-ons: Customise your policy as per your needs. Don’t add everything that your insurance provider, agent or broker recommends.
- Avoid Claims for Small Repairs: One should always avoid filing claims for small repairs, as insurers see this as risk and may raise your premium accordingly.
- Upgrade To Advanced Security Systems: Insurance companies often offer small yet valuable discounts to customers who install certified anti-theft devices such as GPS trackers, dashcams, gear locks, and steering locks, as these features help reduce the risk associated with the vehicle.
Insurance is mandatory under the Motor Vehicle Act, and one should always have comprehensive car insurance coverage for added peace of mind. By following the above-mentioned tips, you can reduce your car insurance premium without compromising on the benefits of your policy.
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