HomeInsurance

Factors and Events That Can Increase Car Insurance Costs

It is mandatory for car owners to buy car insurance before taking their vehicle on a public road in India. Having an own damage policy is not compulsory but a third-party policy is a must for covering liabilities arising out of mishaps. That said, when you shop for car insurance, you may find that most insurers offer different premium rates. Also, you and your friend might be owning the same models but when it comes to the insurance rate, there can be a huge difference. This is because the amount you pay for car insurance is impacted by several factors- some of which you can control, some you don’t have power upon.

So, it’s important to know what makes you pay more for car insurance and what you can do to lower your expenses.

1: No claim bonus: It directly impacts your premium cost

  • Renewing your car insurance on time reflects your care for your family and also towards the vehicle. It secures you as an owner against legal actions, offering you peace of mind and protects your savings in case of any mishap.
  • Also, the biggest advantage of renewing your car insurance on time is that you can avail of No Claim Bonus protection from the insurer, helping you earn a premium discount on next year’s premium. It’s a reward that insurers offer to their customers when they do not file any claim in a policy year. So, if you let your car insurance policy lapse, you end up paying higher premiums.

 

2: Your car: Not just you, but your vehicle also determines the premium. 

  • Generally, more expensive vehicles attract higher premiums as their repair costs are also high. You will have to pay more for insuring imported cars, Luxury SUVs, high-end sedans as compared to an affordable hatchback.
  • Also, the type of fuel your vehicle drives on impacts car insurance premium. The insurance cost for a diesel car is more than that for a petrol car.

 

3: Your location: Yes, it also matters

  • Car insurance in metro cities costs more as compared to Tier-3 towns or rural areas.
  • Insurance companies have their preferred insurance zones which are based upon the data they gather. These inputs include data related to theft, accidents, incidents of vandalism and the number of claims from that area, which will directly affect your premium.

4: Security Features: They can help lower the premium

If your car does not have features like safety airbags, GPS tracking, anti-theft devices, rear-view cameras and advanced braking systems, you may end up paying high premiums on your car insurance. These features lower the risk of damage and theft to your vehicle.

5: Driving Records: Risk drivers may have to pay a higher premium 

Reckless driving carries with it a substantially increased accident risk and can negatively impact your premiums. If you have a history of traffic violations or police records, car insurance companies may consider you a high-risk driver.

Want to calculate your car insurance premium? Car insurance calculator is the solution

Before purchasing a car insurance policy for your vehicle, you can calculate premiums that you will have to pay with the help of a car insurance calculator. The car insurance calculator also makes it easy to compare and find out how much you will pay for coverage.

Conclusion

Now that you know what impacts your car insurance costs, you can lower your premiums just by renewing the policy on time, driving safely and adding safety features to your vehicle. Also, you can check and compare a variety of car insurance policies available on FINSERV Markets and avail the benefits of the one that suits you best.