Finding car insurance premiums too high? Here are 9 ways to reduce them

by Kanika Shelatkar Insurance Consultant

Car prices see a rise every year with newer models and upgrades. Getting maintenance and repairs done is also a costly affair with costs increasing for each repair. Getting older cars repaired also adds a substantial amount to the repair bill.

To add to this, car insurance premiums are also high. As per the Motor Vehicles Act, getting third party liability insurance is mandatory. This insurance has to be purchased for each car owned. But third-party liability insurance is not cheap. With loss and damage to the vehicle and personal accident policy added, four-wheeler insurance premiums can get unaffordable.

But there are ways and means to work around these high premiums and make sure you get a better deal for your buck.

Here are 7 ways to reduce high car insurance premiums:

1.      Merge car insurance policies: If you have more than one car, you can consider clubbing both the four-wheeler insurance policies. Some insurance companies give discounts when you club multiple insurance policies together.

2.      Increase voluntary deductible: A voluntary deductible is an amount that you agree to pay out of your own pocket. This means you will shoulder some portion of the loss in case of a claim. Any amount over and above the voluntary deductible is paid in case you make a claim. Most insurance companies give a discount if you opt for a voluntary deductible. The discount percentage depends on the amount of voluntary deductible opted for.

3.      Car insurance portability: If you’re not satisfied with the quality of services and the facilities that your current insurer provides, then you have the option to port or to switch insurance companies. Some insurance companies provide discounts to get people to switch to them.

Purchase car insurance from your existing insurance provider: If you’ve already purchased other general insurance policies from any insurer it may be worthwhile to inquire whether they provide discounts on clubbing. Some insurers provide discounts if you’re an existing customer. This can help you save on the insurance premium, albeit not a large amount.

5.      Avoid making small claims: Any claims you make directly impact your no claim bonus. No claim bonus is the most important tool you have to reduce your insurance premiums. The No Claim Bonus (NCB) is a type of bonus that the insurance company awards you in case you do not make any claim in the previous year. This reward translates into either a top up or increase in the sum assured or as a reduction of the annual premium for insurance. This reward gets impacted by claims made during the year.

If your claim for repairs is small, you can consider paying it out of pocket but keeping your NCB intact.

6.      Buy car insurance online: Car insurance is cheaper online as compared to offline policies. Offline policies have agent’s commissions factored into the cost as well. Buying car policy online can save these costs as well as provide a way to compare offerings from different insurers. It is very important to spend time thoroughly researching different insurance policies. This way, you can find out the different inclusions and exclusions for each policy and pick the one that gives the best value.

7.      Skip the additional fittings: The insured value of the car depends on the basic price of the car along with other fittings that may be a part of the car such as customized parts, CD players, sensors etc. These also include aesthetic changes such as decals, customized paint etc. To put it simply, fittings include anything that doesn’t come with the car when it leaves Ensuring these fittings can add up significantly to the annual premium.

8.      Profession based discounts: Some insurers provide discounts to people from a certain profession like doctors, accountants, lawyers etc. Some professions that involve a lot of travel may have a higher premium. In case your travel is restricted to the city and is limited, you can contact the insurance company and ask for a discount.

9.      Don’t let your policy lapse: Insurers provide discounts to loyal customers who keep their car insurance policy active and pay their premiums on time. If you let your policy lapse, the new policy will be treated as a new policy without considering your previous discounts. You will also lose your no claim bonus. 

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Created on Jun 24th 2019 02:44. Viewed 478 times.

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