” data-medium-file=”https://images.financialexpress.com/2019/09/car-insurance1-300×194.jpg” data-large-file=”https://images.financialexpress.com/2019/09 /car-insurance1-620×413.jpg” class=”lazy lazy-hidden wp-image-1694275 size-full” data-lazy-type=”image” src=”https://images.financialexpress.com/2019/09 /car-insurance1.jpg” alt=”car insurance, motor insurance, monsoon, car insurance, motor insurance, types of car insurance, importance of car insurance during monsoon, motor protector, amortization shield, what is amortization without amortization coverage, ” width=”660″ height=” 440″ srcset=”” sizes=”(max-width: 660px) 100vw, 660px”/>
Insurance regulator IRDAI (Insurance Regulatory and Development Authority) has made quite a few changes in the auto insurance space and introduced new rules and regulations that portray the necessity of buying auto insurance. With these new rules, it has now become necessary to take out motor insurance for every vehicle. However, the premium may vary. For example, the following year after taking out the policy, you may have to pay a different premium than the premium that was paid when the insurance was taken out.
With numerous factors affecting the policy premium, policyholders end up paying a higher premium during renewal. While insurance companies follow a different process for calculating policyholder auto insurance premiums, there are a few standard things you can steer clear of to avoid premium increases.
Here are some things to avoid to get a lower premium:
Buy online – You can choose to take out a policy online, as you know the product well. Experts suggest that policyholders should know the product they are buying well. So if you understand the product well, you can also buy the policy online from the insurer’s website as many companies offer competitive prices on their own website.
No Claims Bonus (NCB) – If you don’t claim minor damage for minor accidents on a policy in a year, companies will give NCB. While the no-claims bonus varies from company to company, it can be as high as 50 percent for 5 claim-free years. However, if you submit a claim in the meantime, the no-claim bonus will be reset to zero, which in turn will lead to a higher insurance premium being paid. So to avoid paying the higher insurance premium, drive safely and don’t make small claims.
MUST WATCH | How to record PF online?
Expiration of policy – Try to prevent your policy from expiring. Insurance companies generally inspect the vehicle if you miss the policy renewal deadline. Pay attention! As a result of this inspection, insurance companies usually charge a higher premium. Therefore, make sure that you do not let your policy expire. There have also been occasions where policyholders have completely lost their NCB as their policy has expired more than 90 days.
Insured declared value (IDV) – At the time of renewal, depending on the age of the vehicle, the insured declared value (IDV) is determined together with the premium of the policy.
Therefore, it is better to put the correct ‘vehicle value’ on which the policy was purchased. The IDV is calculated based on the number of years the car has been used and the vehicle’s depreciation applied to the ex-showroom price for vehicles up to five years old. Their market value is taken as the IDV, for vehicles older than five years.
additives – Add-ons with normal coverage can greatly help you in the event of a crisis. Popular add-ons such as zero depreciation and engine protection help the policyholder avoid paying a higher premium in the long run. Keep in mind that while getting additional coverage can help in the long run, getting a rider with the insurance policy also increases the premium. Therefore, evaluate and assess your needs while choosing these add-ons.