Tips and tricks to choose the best car insurance plan for yourself

While buying a car, you do an extensive research on which car should be bought as you don’t want to go wrong with this decision. Then why does it happen that insuring your car is left on the discretion of your insurance agent? He suggests you a plan and without a second thought, you insure your car without knowing the minute details which can help you save quite a few bucks and get you the same cover at subsidized rates. Also, insurance is compulsory for every vehicle which runs on Indian roads as per “The Motor Vehicles Act”.

Few tricks and tips if you are aware of can give you some of the best deals while insuring your car. Let us have a look at it in detail.

Pay small claims from own pockets

Often it happens that your car is slightly damaged and its repairs might cost you a small amount. Such expenses should not be claimed from the insurance company as it will impact your no claim bonus.

Transfer your No claim bonus

No claim bonus is a reward in the form of discount offered by the insurance company to the person holding the policy for driving safely and making no claims throughout the year. This benefit is transferable from one car to another of the same owner. So, if you happen to buy a new car and sell off your old car, do not forget to get your NCB transferred on your new car. This can substantially reduce your premium.

Install anti-theft devices

Anti-theft devices like a GPS vehicle tracker or electronic immobilizers. However, these Anti-theft devices should be approved by the ARAI i.e. Automobile Research Association of India. Insurance companies provide a discount of 2.5% on the premium if the car has inbuilt anti-theft devices.

Opt for deductibles

You can avail voluntary deductibles in which if you claim any expense, a fixed amount will be paid from your pocket and the balance will be reimbursed by the insurance service provider. Voluntary deductibles offer a discount on the premiums.

Renew car insurance before due date

Do not forget to renew your car insurance. Make a reminder of the due date and make payment before the due date to avoid unnecessary issues. Suppose, you fail to pay a premium on time, the policy might lapse and to renew the policy is equivalent to getting a new one. Your vehicle might be inspected again, the IDV will be calculated in a revised manner and the premiums could also be inflated.

Buy car insurance online

Now, you can compare the plans offered by various insurance companies and opt for the one which fits your need the best. Websites offer you all round the clock customer assistance and help you evaluate the options available in the insurance market. Also, great discounts are offered to buy online as it eliminates insurance agent commissions and extensive paper work. Buying a policy online provides you a great deal at a click of the mouse.

Do not forget the fine prints

Many times, the low premiums are tempting for people to buy a plan without reading the fine prints in entirety. Remember to read the terms and conditions before buying a plan. It might involve an investment of a little more time but it will be worth in the long run.

With the evolving technology, you can now buy almost everything under the sun be it gold, property, grocery, insurance with the help of internet. It only demands to be careful and knowledgeable about the purchase you wish to make. With the help of above tips and tricks, you can ensure your car at cheap premiums with all the desired features.

Source: Tips and tricks to choose the best car insurance plan for yourself

Top #5 Ways to Cut Your Car Insurance Premium

While I was way too excited to drive my new car, I was well aware of the additional obligations coming my way. Knowing that insurance is mandatory while driving on Indian roads, I decided to insure my car as soon as I get the possession of my car. However, with an ongoing EMI for home and car, household expenses and children’s education cost, I wanted to buy a car insurance plan which will not pinch a big hole in my pocket. So, my basic aim was to buy a car insurance which can be cheap as well as best for me.

I spoke to one of my friend who is an expert in car insurance segment. He recommended me that there are few factors which can help me lower my car insurance premium. Let me explain you the top 5 factors which can help you reduce your car insurance premium considerably.

1. Don’t make claims for small damages
2. No claim bonus
3. Opt for voluntary deductibles
4. Policy renewal on time
5. Ensure your car online

Don’t Make Claims for Small Damages

While driving you might have a small scratch the repairs of which might cost you a few thousands of rupees. Pay such small expenses from your own pockets so that you can avail the no claim bonus on your next premium.

No Claim Bonus

No claim bonus, commonly known as NCB, is a discount offered by the insurance company for driving safely and not claiming any bonus during the insured period. This bonus starts at 20% and can go up to a maximum of 50%. The NCB is transferable. Suppose, you are availing NCB for the past 2 years and you happen to buy a new car by selling the old one. You can transfer your NCB from your old car to the new car as it is a reward given for safe driving.

Opt for Voluntary Deductibles

Deductibles are the amount of loss (caused due to the vehicle being damaged) the policy holder will have to bear from his own pockets before making a claim with the insurance company. Ideally, there are 2 types of deductibles one is compulsory deductible and other is voluntary deductible. As the name goes, a compulsory deductible is mandatory and inbuilt with the policy. The voluntary deductible can opt at the will of the person buying car insurance. The insurance company provides a discount on premiums if you opt for voluntary deductibles.

Suppose you opt for a voluntary deductible of Rs.5,000, a discount of up to 25% can be availed on the premium. Your car is damaged due to an accident and expenses come to Rs.20,000/-. In such case, the insurance company will pay 14,500/- ( 20,000- 5000 {Voluntary Deductible} -500 {Compulsory deductible}.

Policy Renewal on Time

Renewing policies on time have its own set of advantages. First is you can claim the benefits of accumulated bonus and second is you don’t need to get your vehicle being inspected again. If your policy lapses, it is same to like buying a new policy with the premium being calculated again and the vehicle being inspected.

Ensure Your Car Online

Online buying of insurance is trending these days. You can compare plans of the various insurance company and select the one which suits you the best. 24/7 customer assistance, hassle free, paperless and convenient is some of the benefits of buying online. Also, you can get great discounts at the time of buying the insurance plan.

Above points when looked upon carefully can ensure you get the best suitable car insurance plan. After getting my new car, I insured my car at some great discounts. You should also take the above points into account before insuring your car.  

Source: Top #5 Ways to Cut Your Car Insurance Premium

Top #6 Reasons to Buy a Superb Comprehensive Motor Insurance Plan For My Brand New Car

When you are buying a car, be it your first car, or be it a mid-range family car that you need to upgrade your compact car or be it the top range SUV that you ever dreamt of since you purchased your first car a decade ago, it is always a prized possession and you want to protect it at all costs. But the reality is different. There are innumerable chances that your car might get into some unwanted encounter while you are on road and driving and many might be at no fault of you. To protect you financially for those unforeseen situations, you have to look out for the best car insurance policy that will give you the highest protection.

Though every motorist in India mandatorily needs to have a minimum of third party insurance plan by law, the comprehensive coverage is the best car insurance policy that you can have a brand new car. Here are the reasons why a comprehensive plan is the best idea for your vehicle. 

Covers the Costs of Repair – For the brand new car, the cost of any repair is high. In case the car is involved in any accident and you are to blame for this, then the financial burden of its costly repair will be covered by your insurer under comprehensive coverage. And in case of a wreck, if the damage is huge, you will not get any return in case you do not have a comprehensive insurance plan. 

If the vehicle is stolen – Though the vehicles nowadays come with various safety features and anti-theft devices, it is a good idea to get a superb comprehensive plan. The comprehensive insurance policy will come with the coverage for maximum losses in case of theft. Though the compensation will not enable you to buy the brand new car, the coverage will give you the current value of the car at the time of the theft. 

Damage due to Natural and Man-Made Calamities – Comprehensive policy is the best car insurance policy when it comes to unforeseen situations like the natural calamities. These include flood, inundation, storm, hurricane, typhoon, cyclone, tempest, lightning, fire, explosion, hail storm, frost, earth quake, rock slides and landslides. Man-made disasters are also covered under the comprehensive plan. These include burglary, car break-in, malicious acts, riot, strikes, terrorist activity, or some accident from external reasons. These are covered while driving on road or during travel by inland water ways, rail or air. These benefits for calamities are available even when the car is parked or laid in a garage and is not being in active use. 

Personal Accident Cover – The comprehensive policy does not restrict the compensation for the damage to the cars only. During driving, if there is any bodily injury sustained by the driver and co-passengers, the coverage will include the medical treatments for these people. 

Third Party Coverage – So far the points discussed was pertaining to the damage to you and your vehicle. But, another very important aspect is the third party coverage, which is the mandate of Motor Vehicles Act of 1988 in India. Under your superb comprehensive coverage, the third party will be covered in case your vehicle gets involved in some accident or property damage to parties other than you. Third party coverage protects you financially by covering any claims by the third party due to the bodily injury, disability or death and any damage to property of other people that is caused by your vehicle at your fault. At those times of distress, this coverage supports you immensely.

No Claim Bonus – This is the additional benefit you can get in your Comprehensive coverage and major insurance companies have this feature to offer in their product. In case you have made no claim in a particular financial year then you are eligible for ‘No Claim Bonus’ and your insurer will offer you a discount in the next year’s premium payment. This is the reward you can get for a good driving of your brand new car. 

Hence, though comprehensive coverage makes the premium go high, still it is a better idea to have a superb comprehensive coverage that will give you the financial protection as well as the peace of mind against the whole array of possibilities of car damage. Especially for a brand new vehicle, the compensation is worth in case of any eventuality, since it is highly effective in comparison to other coverages and protects from many different hassles.

Source: Top #6 Reasons to Buy a Superb Comprehensive Motor Insurance Plan For My Brand New Car

Do I need a zero depreciation add-on cover?

Zero Depreciation Add-On Cover

Zero depreciation is a kind of additional coverage that is available to car owners at a supplementary premium rate. This is not usually included as part of the regular car insurance plans.

Essentially, when insurance companies deal with a claim, they apply a depreciation rate in order to arrive at the payable amount. Whatever is the difference in worth between the market cost of the required part and the depreciated part is to be taken care of by the owner of the automobile.

Now, with a zero depreciation add-on, the insuring company will be responsible for covering the full price of the part that is needed. For somebody who wants a hassle-free claims process – zero depreciation is one of the most valuable car insurance plans. It is an important add-on if you are a new car owner. This is obviously dependent on your ability to pay a higher premium for this add-on.

Depreciation Rate

Usually, the depreciation rate considered by companies differs with different insurers. Yet, there are some standards according to which this rate is calculated. For example, a few car parts depreciate at a faster rate than others. So the depreciation tends to be more with such parts. Similarly, depreciation rates are calculated for different automobile parts in all car insurance plans. Usually, parts made out of materials such as rubber, plastic and the battery depreciate at a quick pace. Auto-parts such as fiber glass depreciate at a much slower pace.

Zero depreciation is a great add-on as it is a good plan to stop depreciation factor related money loss at times of insurance claim. Regular comprehensive car insurance plans do not take into account damages to parts made of glass, nylon, plastic, fiber etc. This special ass-on other hands will take care of all these parts and any claim that arises for them. The best part about this add-on is the peace of mind that comes free with it, especially for a new car owner.

Other Things to Know

Most car insurance plans only cover new automobile under the zero depreciation add-on. If the automobile you own is older than the insurer’s limit, then there is a fair chance that you will not be able to avail this add-on.

There is a certain kind of fee known as Compulsory Excess that is part of this add-on. Under this, the insured party with zero depreciation add-on needs to make a payment for a compulsory policy excess. This is as the coverage may not always be all-encompassing as some insurers may not cover regular wear and tear of the car.

A detriment with this addon is that there may be a limit to the number of insurance claims that you can file in one calendar year.

In Conclusion

Your car is a machine that is susceptible to all kinds of damage, human or natural. A regular car insurance is a great choice but consider a zero depreciation add-on to be even safer. Care for your vehicle as you should by picking the right car insurance plans.  

Source: Do I need a zero depreciation add-on cover?

Motor Insurance becomes more expensive: What is my actionable?

With rising inflation, increase in number of claims made and loss ratios of insurers, IRDA has enforceda hike in third party Motor insurance. Effective from April 1, 2017.The third party Motor insurance premium rates are increased up to 40 percent. For Small cars with engine capacity of 1000 cc to 1500 cc the applicable rates are 2237. While cars exceeding 1500 cc applicable rate is 6164. For two wheelers category, the hike is from 16 to 40 percent depending on the engine capacity. This hike in motor insurance implies that if you are buying a new car or an old car, you need to pay an extra premium. As third party insurance is mandatory by Motor authority of India so one cannot escape buying it. But still you can save on premium with the following actionable.

Buying a standalone third party insurance:

 If you want to save even a little on the premium you can opt for the standalone third party insurance that covers any damage to property, injury or death of the third party due to any unfortunate event like accident. Although it is advisable to purchase a comprehensive motor insurance that covers the insured, vehicle and third party in a single policy and all the risks covered in the Motor Vehicles Act plus loss or damage caused to the vehicle due to uncertainties as per inclusions. But it may cost you high on premium. So if you are a safe driver and use the car sparingly, use can opt of standalone third party insurance.

Opting for a voluntary deductible

Voluntary deductible is the amount of claim you want to willingly pay and the insurance company pays the balance amount .Thus here you agree to share the cost of repair during claim .Opting for a voluntary deductible lowers the premium amount for your insurance plan. Here in you can opt for the amount of deductibles you want to pay .If you are a safe driver and have small car, your average cost of repair might be low,so you can opt for a lower deductible and vice versa.

NCB :Non claim bonus is the bonus accumulated for every consecutive  claim free year over the insurance policy tenure .NCB can lower the premium for up to 50%. So, if the current claim is lower then what you can save as premium with NCB .It’s better to pay with your own pocket rather thangetting a claim and loosing on NCB and lowering the premium amount.

Bundled car insurance:
You can also save on premium by bundle the insurance plans of all cars in your household. The insurance provider can offer you a good discounted premium if you opt to buy the motor insurance from the same insurance company.

Buy a multi year insurance policy for your two-wheelers:

Recently Insurance providers have started to offer Multiyear motor insurance. These policies are cheaper than annual-renewal plans also Insurers give discounts ranging from 2%-6% on own-damage insurance for such plans. Also multi-year motor policies will be exempt from Insurance Regulatory and Development Authority of India's (IRDAI) annual premium hikes,which safeguard for the future hike in premium rates by IRDA for at least 3 years. Some of the companies which offer Multiyear insurance policy are ICICI Lombard, New India, HDFC Ergo, Bajaj Allianz General, etc.

Excluding the frill and installing safety features:

If your car has safety features/anti-theft devices like locks for the steering wheel and gear, anti-theft alarms then you can save on premium up to 5%. Thumb rule is,more safe is your vehicle lesser is the premium. Also adding extra modifications and expensive gadgets like adding alloy wheels, spoilers, automotive night vision, ultrasonic sensors, etc. may lead to a higher premium .So one should avoid all this extra modifications to avail lower premium.

Think twice and compare before buying

Usually when you buy a new car from the dealer, the dealers offers you to purchase the car insurance from its alliance companies/banks but it may not be the cheapest option .You should check online and compare quotes from other insurance providers and banks, also the bank through which you are taking the loan for the purchase of car might offer you better and discounted options. Lastly Compare all the features and buy accordingly. You should also remember that you may get better offer, discounts and loyalty benefits if you have multiple policies from the same provider. Also, if you are buying the insurance policy from the same provider from several years, then you should look for better options available in the market.

Bottom Line

Lastly, motor insurance is equally important as buying a car itself, it should be well thought of and bought accordingly. Though Third party insurance is statutory and hike up to 40% might burnout pocket but it gives you peace of mind and a protection against the unforeseen circumstances .You can buy either a standalone third party insurance or a comprehensive cover,also by following the actionable mentioned above you can save a little on the premium you pay on the own-damage cover.

Source:  Motor Insurance becomes more expensive: What is my actionable?