When Should You Change Your Car Insurance Policy?
As per the Motor Vehicle Amendment Act 1988, Driving without a valid car insurance is illegal and is mandated by the Indian law. To buy motor insurance, one should do the right amount of research and get a policy that offers adequate coverage. You need to do a thorough check of the coverages provided by insurance companies in the market. Read the document and coverages carefully before making any choice.
Also, it is not necessary to wait for the existing policy to expire before making a switch to other one. If you have made your mind to switch the insurer, you must do a get around, and evaluate your needs and your eligibility for discounts. It will then help you to go a long way in saving on your car’s insurance premium.
Reasons to switch existing car insurance policy:
- Expensive premium: There are possibilities that your car insurance company is charging hiked premium from you. Insurance premiums vary from company to company on the basis of coverages. One should note that the rates are not makeable as they have to be as per the standard market rates. However, if you still find your car insurance premium too high in comparison to other companies, you can go for a switch.
- Service: Poor quality of service is one of the important reasons for the car owner to change his/her car insurance provider. Services like long claim settlement process, the disinterest of insurance providers in listening to customers can annoy the customer due to which they make up their mind to search for other insurance companies.
- Poor Customer service: Companies generally invest a lot in providing good customer service. However, if a car insurance company does not give satisfactory suggestions to its customers’ queries, then there is a possibility that the customer can take a move to switch the insurance company.
- Insufficient Additional Covers: Every car owner has different needs. Basic car insurance might not cover the risks involved in an accident. Insufficient add-on services given by car insurance companies can also be a reason for the customer to look for a new insurance provider.
Steps to change the insurance company
- Compare policies - Check the premium available with various insurance companies in the market to get a clear picture of coverages. Compare the car insurance prices, features and coverages and then make a choice.
- Inform your present insurer - Inform your insurer that you are switching the company. There are some possibilities that you are eligible for other perks like discounts or loyalty.
- Check for penalties - Many companies impose some fine due to policy change during the policy year. It varies from company to company. So, you will have to check if the penalty is applicable then you should pay it before switching the policy.
- Investigate the new company thoroughly - After deciding upon a new insurance company, you should investigate the coverages and features carefully and make an informed choice. You can check the details like reviews, claim settlement ratio, coverages etc.
- Avoid break in insurance - While changing the insurance company, ensure that there is no gap in coverage. Meaning that you should make sure you take the new plan and not cancel the existing policy before receiving new.
- Ensure cancellation of the old policy - Make sure you have cancelled the existing policy through a written notification.