September 30, 2022
  • September 30, 2022

5 easy ways to make your car insurance more profitable

By on March 22, 2022 0

If rising inflation and limited movement amid the third wave of Covid have you wondering how to lower your insurance premium, know that there are simple ways to do it effectively.

Even in two years of restricted mobility, if anything that has continued to be an essential part of life despite limited use, it has to be his car. Whether you are driving or not, you always pay attention to the slightest damage to your car. Just as your car is an integral part of your life, auto insurance is an integral part of your car. So even if you have cut your driving in half, it is still mandatory to ensure that your car insurance is in place.

As you probably know, third party coverage is a legal mandate for all vehicles used for personal and commercial purposes. However, if rising inflation and limited movement amid the third wave of Covid have you wondering how to lower your insurance premium, know that there are simple ways to do it effectively. Let’s take a look at some helpful tips to save more on your car insurance premium.

Get the most out of your NCB

A No-Claim Bonus or NCB is the best way to save on your car insurance premium. It rewards you for each claim-free year with a reduction on your premium upon renewal in the event of no claims. In accordance with the rules, you can benefit from a reduction of up to 20% on your first claims-free year, 25% for two years, 35% for three and 45% for four consecutive claims-free years. Make sure you don’t lose this benefit by making these two mistakes – Not renewing your policy within three months of the policy expiry date and losing the entire NCB by making a claim, even for a small amount . For small damages, always pay out of pocket rather than filing a claim. In addition, in the event that you buy a new vehicle by reselling the old one or by transferring your policy to a new insurer, always remember to transfer your bonus-malus.

Save more by buying insurance online

It is always advisable to do thorough research before buying your car insurance policy. This not only includes terms and conditions, but also a comparison between different insurers and the benefits they offer. Since one has a limited reach offline, it is always better to visit the websites of online insurance aggregators to buy affordable and best suited car insurance. With online shopping, it is always easier to compare the prices, features and benefits of different insurers and select one according to your individual needs and requirements. In addition, online distribution channels are more economical every day than traditional channels, which also reduces your premium. It is also useful to check key aspects such as the claims settlement rate of different insurers, as this has a direct impact on your policy. So don’t forget to compare online before making a final call.

Consider your deductible

The deductible, also known as the voluntary deduction, is a key factor in determining the cost of your premium. This is a disbursement borne by the insured at the time of the declaration of loss. Choose your deductible wisely. If you keep it at zero, you will receive the full claim amount, but end up paying a higher premium. If you are an experienced and confident driver or if you have not made a claim for a few consecutive years, you can choose a higher deductible which will help reduce your premium amount.

Evaluate your need: TPI Vs Own damage coverage

The Covid outbreak has made remote working and staying indoors the new norm, at least for the duration when case numbers are dramatically high. Now is probably a good time to reassess your insurance needs. Civil liability insurance being compulsory, its subscription is non-negotiable. You should also decide to purchase your own usage-based damage coverage. For new car owners, the law imposed a full 1 year + 3 year TPI policy when purchasing the car. This means that for the second and third years, the client only has to purchase a stand-alone Personal Damage Insurance (SAOD) policy. But, suppose you have an old car that you don’t drive frequently, third-party coverage should suffice. For small damages, out-of-pocket expenses may cost less than the full policy premium.

Pay premiums and renew your policy on time

The easiest way to save on auto insurance premium is to pay premiums regularly and renew the policy on time. If you don’t pay the premiums on time, the insurer could assess this as a risk for the future and increase your amount. Also, if you let your policy expire, you will lose the main benefit – your earned PNE. In addition, you will have to go through the inspection process again and depending on the condition of your vehicle, the insurer could increase the amount.

(By Ashwini Dubey, Head-Motor Renewals, Policybazaar.com)