Simple Ways to Reduce Car Insurance Premium

When it comes to car insurance, it is imperative for one to own it to abide by the rules laid down in the Indian Motor Tariff and avoid legal consequences. As per the Indian Motor Tariff Act, holding a third party insurance coverage is compulsory to own with a mandatory personal accident cover of up to Rs. 15 lakh.

Car insurance is a necessity as it protects you against the unforeseen expenses that may arise due to an accident or any mishap involving your car. However, despite being essential, many people could not easily afford this cover and take it as a burden.

Therefore, the following are some simple ways which can help you get your car insurance premium reduced:

Choose Policy Wisely

Car insurance safeguards you against the expenses that may arise due to an accident or mishap. Hence, it should be chosen very carefully and with a good amount of research. You should have a look at different insurance providers to find the best possible car insurance policy based on different factors such as budget, requirement, add-on benefits availability, payment services, network garages, claim settlement ratio, etc. A comparison of different insurance plans helps you identify the one which suits your requirements as well as your budget in the best manner.

Utilize The No Claim Bonus

No Claim Bonus (NCB) is a discount, rewarded for not making any claim in the previous policy year. You can earn this bonus, simply by driving carefully. The NCB ranges up to 50% discount on the own-damage premium, which is a handsome amount to save. The NCB remains intact even in case you want to sell your old car and buy a new one. In such a case you can carry forward your NCB to your new car. For this, you will require to collect a no-claim certificate from your insurance provider. It will assist you in lowering your premium cost for a new car insurance plan by transferring your accrued no claim bonus. Therefore, it is also recommended that you should not request an insurance claim for every single damage sustained by your car, rather try to bear small expenses on your own, otherwise, it can make you lose the accrued No Claim Bonus benefit.

Apply For Laid-Up Vehicle Concession

If your car is not in use for a long time, you can use this feature. It allows you to apply for a laid-up vehicle concession as per which you can extend your car insurance cover for a particular duration during which your car remains off the road. This will reduce your insurance cost for a specific period. You will have to convey to your Regional Transport Office (RTO) of your area to avail this benefit.

Equip Your Car With Safety Devices

Safety devices serve you in two ways. They offer safety as well as a discounted premium for your car. If your car is armed with safety devices such as an anti-theft alarm you can be provided with a discount on your premium amount by your insurer. Hence, keep your car equipped with advanced safety devices to enhance your chance of gaining a premium discount from insurance providers.

Members Of WIAA and AAI Can Avail

Insurance providers offer discounts to people who are members of the Western India Automobile Association (WIAA) and Automobile Association of India (AAI). These are organisational bodies empowered by the Motor Vehicles Act and Rules. So, if you are a member of any of these bodies, you can avail your membership to earn the discount benefits provided by your insurance providers. Therefore, being a member of these organisations and driving safely is an easy way out to get reduced premiums and feel privileged.

Get The Correct IDV For Your Car

Insured Declared Value (IDV) is the value up to which your insurance provider can provide you with the compensation against any damage or loss incurred by your car. The IDV is the present market value of your car less the default depreciation applicable. However, as it impacts the premium amount, therefore, you should compare various online car insurance plans to determine which insurer is offering the right IDV for your car. Otherwise, you may select a policy with wrong and higher IDV for which you may end up paying a higher premium. You can find car insurance calculators on some credible and renowned insurance platforms like Financegab.com, with which you can get the right IDV instantly at a click.

Renew Your Insurance Policy On Time

Policy expiration can lead you to lose your No Claim Bonus (NCB) benefits. To ensure the renewal of your policy, you can request your insurer to remind you in advance when the expiry date is approaching. With this approach, you could renew your policy on time and make your NCB benefit intact that will make you pay for a reduced insurance premium amount. It is the simplest way of where you just need to be responsible to gain premium discounts.

Take Away

Everyone wishes to get an insurance policy at low premium costs. Though, insurance plans are beneficial but sometimes can adversely affect your budget if you try to choose an extensive coverage plan. However, in a bid to get you the desired insurance cover at reasonable prices, we have come up with some simple ways described above in the article. Opt for some or all of the above-mentioned ways and make minimise the premium amount of your car insurance plan easily.

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About Geet Sharma

My Name is Geet Sharma Financial Blogger & Founder of Paisabank.org. We are a personal finance blog dedicated to finance & financial planners. The main aim of this blog is to help people to informed about financial decisions.
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