Why car insurance costs less online

by Kanika Shelatkar Insurance Consultant

Have you ever checked and compared your car insurance quotes online? If you have, you will come across premiums that differ across different plans. Additionally, car insurance prices are different when you buy from an agent or broker and when you buy online, directly from the insurance provider’s website. Have you ever thought why there is a difference in the rates?

Online purchases always cost less, and that is why most of you prefer online shopping. The same holds true when purchasing car insurance online in India. When you purchase the policy using the online platform, the prices are lower as compared to the offline method.

Here are a few reasons car insurance cost less online

No distribution costs

Offline car insurance policies are sold by middlemen such as agents and brokers. These middlemen charge a fee from the insurance provider for selling the insurance policies. The commission given to intermediaries is claimed from you, in the form of distribution costs. In the case of the online platform, there are no middlemen involved. You can simply purchase the policy yourself by eliminating the middlemen and their fees. It lowers the distribution cost for the company which, in turn, brings down the car insurance prices.

Various discounts

Online car insurance policies offer numerous discounts on premiums. For example, new insurance companies may give some deals on their website. The available discounts and their rates differ across policies. When you research online, you can search for the best discount rates available. The higher the discount, the lower would be the car insurance quotes. Thus, by allowing you to compare discounts, insurance online in India is cheaper than purchasing the policy offline.

Low operational costs

Online platforms remove the requirement of having physical insurance offices from where you can purchase the car insurance online. The company creates its website and offers its plans online with a list of features and the premiums rates. Additionally, the whole process of purchasing the policy is processed online. All these factors bring down the operational costs involved in issuing the policy. This decrease in operational costs results in lower car insurance quotes.

Easy comparison

Every car insurance policy offered by every insurer varied premium rates. When you assess the available policy online, you can find a policy with ease which has the lowest premium rates with the appropriate coverage. It is also another reason why purchasing online has a lower premium rate as it allows the benefit of comparison.

You can choose the required add-ons

When you buy a car insurance policy offline, the middleman might offer a package of optional add-ons into your policy to increase the premium and, subsequently, the commission as well. Online purchases, however, extend complete clarity. You can select the add-on cover that you require and remove the unnecessary ones.

The online method is simple and beneficial as it helps you save on the premium. Both insurance providers and insurance aggregates are aware of the advantages of online car insurance policies. There are premium calculators where you submit details of your car and calculate the premium of the car insurance policy. The calculator also allows you to compare the premiums of different policies which helps you in finding the lowest premium rate. So, go online, and save your hard-earned money.

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Created on Nov 4th 2019 07:43. Viewed 343 times.

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