Who wouldn’t like the idea of saving? After all, for most of us, our expenses have outweighed our earnings. The credit for this goes to spiraling living cost also. But what if we told you that you could easily save money where you never expected? Yes, car insurance is one such area where you can easily save money and that too without compromising with your coverage.
Here are some of the ways of reducing your car insurance premium at the time of renewal and add to your savings.
1. Don’t let your car insurance policy lapse
Do not wait for your motor insurance policy to lapse before you decide to renew it. It is essential to renew your car insurance at least 45 days before the policy due date. In case there is a break in the policy renewal, the insurer may ask you to pay penalty charges as well. Also, the insurer may also go for vehicle inspection again.
2. Compare car insurance policies Online
Make use of the internet to compare all the available car insurance policies to find the right vehicle insurance company as per your budget. It will help you derive the maximum benefits from the policy. As most of the insurers have their presence in the online world, you can take the benefit of car insurance online renewal facility. Going online and using the car insurance premium calculator will help you calculate the premium amount and compare the quotes obtained from different insurers.
3. Check the features
Before renewing your car insurance policy, it is essential to go through the features of the same in order to find out the redundant elements which you can remove from your policy. For instance, you might be paying for personal accident rider under your car insurance, however, if you have already purchased this cover separately, you can remove the clause and pay less. Also, a thorough understanding of the policy at the time of renewal of car insurance is a good move to expand your policy with new riders or features.
For instance, at the time of buying car insurance, your vehicle was installed with CNG kit which you have now recently got removed. It is essential to inform the insurer at the time of car insurance renewal so that your premium can be adjusted accordingly. In most of the cases, car insurers increase premium when you install the CNG kit, therefore, inform the insurer at the time of renewal to lower the premium rates.
Similarly, if you have become a member of any designated automobile associations in the last one year, you can earn a discount of 5% on the own-damage insurance part of your policy. Therefore, let your insurer know about this new fact to cut your premium rates.
4. Compute the value of your Car
At the time of policy renewal, calculate the current value of your carin accordance with the market value. It will help you find the depreciated value of your vehicle and thus, you would be in a better state to negotiate with the car insurance company on this.
5. Go for high deductible
In the insurance field, thedeductible is the amount that you would have to pay at the time of claim before the insurer settles the remaining claim amount. Let’s say, you have a car insurance claim of Rs 15,000, and your deductible is Rs 5,000, here you would have to pay Rs 5,000 and the insurer would settle the remaining amount, i.e. Rs 10,000 (15,000-5,000).
As deductible is directly proportionate to premium rates, you can lower your premium by increasing deductible and vice versa. Going for high deductible at the time of policy renewal can help you lower your car insurance premium rates. Though, the deductible can help in lowering your car insurance premium rates, choose the amount carefully. There is no point in having a motor insurance policy if you would have to pay a substantial amount from your pocket at the time of claim.
6. Make use of No Claim Bonus
You will be rewarded with No Claim Bonus (NCB) if you haven’t made a single claim in the previous year. If you are eligible for NCB, claim for it at the time of car insurance renewal. This amount will be deducted from your car insurance quote, and you would require paying less premium.
Here’s how much NCB you can get?
| NCB Rate Grid | |
|---|---|
| Situation | NCB Benefits |
| After One Claim-free year | 20% |
| After Two Consecutive Claim-free years | 25% |
| After Three Consecutive Claim-free years | 35% |
| After Four Consecutive Claim-free years | 45% |
| After Five Consecutive Claim-free years | 50% |
7. Renew online
When you renew your car insurance online, some insurers offer high discounts. The insurance company makes a huge saving in the form of processing and distribution costs when its policyholders carried out their transactions online. Thus, insurers happily passed on these benefits to policyholders in the form of low premium rates. Moreover, online mode allows you to approach the car insurer directly and thus; you can reduce the need of having an agent. Even if you have bought your vehicle insurance offline, you can renew your insurance online as well. Undoubtedly, the car insurance online mechanism is not only convenient but also saves both your time and cost.
A car insurance policy plays an imperative role in protecting you against both third-party liability and damages caused to your vehicle. So, take the cue from the above points and curtail your premium rates at the time of renewal, however, never at the cost of your insurance coverage!
