Any new vehicle that you purchase in India comes with an insurance offered by the dealer. While very few people chose to buy the policy separately, most of us get the same from the vehicle dealer. This ensures that your vehicle has a valid insurance as soon as your drive or ride your vehicle out of the showroom. But on the other hand, these policies have a limited term duration.
The motor insurance that you receive from your dealer is usually valid only for one year. This means that you must renew the same in time to continue enjoying the features and benefits of a motor insurance. it is very important that you renew the policy on time for two major reasons.
The Motor Vehicle Act of 1988 mandates all vehicles to have a valid insurance when they ply on the Indian roads. Secondly, if you do not renew your policy on time, you stand to miss out on a few benefits and features. For starters, if you fail to renew the policy within the grace period, you will end up paying for any damages or repairs should your vehicle meet with an accident during the period. Similarly, you will miss out on no claims bonus and few other benefits.
Tips to Lower Premiums
A motor insurance is a contract between you and an insurer. According to the contract, you must pay a certain amount as premium and in turn, the insurer will offer coverage for your vehicle. Paying a relatively higher premium for the policy is something that ticks some policyholders away from buying one. Here are some tips that you can follow to keep your policy premiums down.
All the motor insurance policies have a voluntary deductible component. A deductible comes into the picture when you claim your policy. It is the amount that you agree to pay during the claims. Thus, setting a slightly higher deductible would reduce your premiums. However, one must be careful and not set a very high deductible since you must pay the same every time you claim your policy.
In the current state of things, you as a potential buyer have a lot of information available. However, it can get a bit cumbersome to collate all of them and decide which policy is the best for you. It is at such times that comparison websites show their true worth. You just need to key in some basic information and the website will return with a plethora of valuable information. You can expect quotes from insurers along with the features that they offer. Comparison ensures that you get the most value for money policy without breaking a sweat or spending too much money.
- Small Claim
The whole idea behind buying a vehicle insurance policy is to cover your expenses during any accidents or repairs. But at times, it is better not to claim the policy. If your vehicle warrants some minor repairs or fixes, it is worth doing the same from your pockets. This way, you can keep your NCB intact which can reap you benefits in the longer run. Just for some context, you can accumulate NCB up to a maximum of 5 years or 50%, which translates into substantial savings.
Every year that you do not claim your motor insurance vehicle, you stand the benefit from the same. Insurers offer discounts to the tune of 20% for the very first year and the same goes up to 5 years or 50%. It must be noted that insurers offer this discount on the own damage component, but even then, you will be able to save considerably. Another important thing to keep in mind is that the NCB is issued to the insured and not the vehicle. This means, that even if you sell your vehicle, you can carry forward the NCB to your next vehicle policy.
The insured declared value of the vehicle plays a crucial role in deciding the premium for your policy. And you as a potential buyer have the control on deciding the same. You can tweak the value and see how the final premium is impacted. However, it is not recommended to reduce it dramatically, since it might have some repercussions down the lane.
- Memberships and Devices
Most insurers offer additional discounts if you become the part of any driving institutions such as the Automobile Association of India or the Western India Automobile Association. Similarly, you can install anti-theft devices to avail further discounts.
The above tips can help you save substantially on your next renewal.