Tips To Reduce Car Insurance Premium Rates

Car prices are rising rapidly and so are the car insurance premiums, especially after the recent hike in the thirty-party insurance premium by up to 40%. Under such circumstances, you know the ways to reduce your car insurance premiums. Find the tips to reduce your premiums in the below article.

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10 Tips to Reduce the Car Insurance Premium

Take a look at the 10 points that will help you in lowering your car insurance premium-

1. Compare Car Insurance

   Before purchasing car insurance, always compare the benefits and quotes offered by various car insurance companies/agents. At Policybazaar.com you have an option to compare car insurance premium rates charged by multiple insurers and choose the best policy for you. It will help you to get the best car insurance premium rates conveniently.

   Moreover, you should ask for loyalty discounts from your existing insurer it will lower your car insurance premium rates.

   However, beware of car insurance companies who claim to offer 'free' or ‘cheap’ insurance - this is usually free only for the first year and it cannot be customised. Most importantly, read the policy fine print carefully before purchasing it.

2. Be Wise with the Coverage

   A car insurance policy is typically a pre-defined set of benefits. Nevertheless, if your policy permits, then out opt-out of features you do not need. This helps lower the car insurance premium to some extent. Do not buy all add-on covers, as they will raise your premium. Choose only those which are required.

3. Choose ‘Pay as You Drive’ Insurance

   ‘Pay as You Drive’ is a newly introduced concept in the Indian motor insurance industry from 2020 and is offered by a few insurers. As per it, the insurer charges a premium only for the number of kilometres fixed in the policy documents. So, if you prefer driving occasionally, this could be the best way to save money on your premium.

4. Increase Your Voluntary Deductibles

   Increasing deductibles or voluntary deductibles can lower your car insurance premium. A deductible is the out-of-pocket amount paid by the policyholder when making a claim. While opting for deductibles, it is better to pay much comfortably rather than going overboard.

   If your deductible is zero, then you will receive the entire claim amount from your insurer in the case of an accident, but the premium you regularly pay will be higher.

5. Avoid Raising Claims for Small Damages

   Well, it is true that the objective of car insurance is to save expenses incurred for repairing a damaged vehicle. But raising claims for small damages could not work against this objective. For the smallest claim you make, you lose the advantage of the accumulated bonus or No Claim Bonus (NCB). Theaccumulated NCBcan lower your car insurance premium up to a maximum of 50% if you have not raised a single claim in the policy period.

   The best thing to do is get your small repairs fixed at local garages. Keep in mind that if the repair amount is lesser than the NCB, then you can potentially accumulate, and refrain from making a claim.

6. Transfer NCB from Old to New Car

   An advantage of not making a claim is that the bonus accumulated is transferable to the new car you purchase. It is, therefore, wise to retain the insurance in your name even after selling your vehicle and ask the insurer to give you the no-claim certificate.

   You can reserve this bonus even if you are not immediately buying a new vehicle. Whenever you buy a new car, transfer the existing policy to it and carry forward the no-claim bonus accrued over the years. This will help you reduce the car insurance premium rate for the new insurance policy.

7. Install Anti-theft Devices in Your Car

   To reduce your car insurance premium, you can install anti-theft devices in your car. Gear locks, steering locks, and anti-theft alarms will increase the safety of your car and hence, lower the premium.

8. Join an Automobile Association

   You can join associations like the Automobile Association of India (AAI) or the Western India Automobile Association (WIAA) to get special benefits and discounts on premiums. These associations are empowered under the Motor Vehicles Act and Rules and the members therein are deemed as ‘safe drivers’.

9. Avoid Modifications in the Car

   Car modifications like adding alloy wheels, spoilers, etc., and expensive gadgets like automotive night vision, ultrasonic sensors, etc. may lead to a higher premium. Hence, such modifications and gadgets should ideally be avoided if you wish to keep your premium low. However, if you still want to introduce modifications at the cost of higher premiums, notify your insurer because if you don’t, your insurer may invalidate your insurance.

10. Renew Car Insurance Policy On-time

    Once your car insurance policy lapses, you may not qualify for NCB that you would otherwise have been eligible for. While buying your policy, make a note in your organizer or ask your provider to send a reminder before the policy expires, so you renew your car insurance policy without fail.

In a Nutshell

Nobody wants to overpay for the car insurance premium. You can smartly save some money by following the above-mentioned tips. Make sure you drive safely and follow all the traffic rules. Also, do not forget to read the policy documents carefully before buying the policy.