How to Reduce Car Insurance Premium?
With the continuously rising rate of accidents in the country, insurance premiums have also started costing higher than before. But the growing competition in the auto insurance sector has brought some relief to consumers. Sometimes it becomes difficult to choose the best policy between hundreds of policy options made available by the car insurance companies. To choose the best policy at the lowest premium, follow our guidelines prescribed below:
1) Protect the no claim bonus
By not making a claim in the current year, you will be eligible for the No Claim Bonus (NCB) in the next year’s car insurance premium. The discount can go up to 30% to 50% if you do not make a claim for 3 to 5 years. Also another big positive of not making a claim is that you can transfer your No Claim Bonus to a new vehicle when you go for a fresh purchase. Even if you are not buying any vehicle in the near future, you can still reserve your no claim bonus (NCB) for three years.
2) Compare and cross-check prices
Most of the auto insurance companies have their presence online. So nowadays it has become much easier to compare car insurance policy premiums. By sitting at home and without visiting any insurer’s office you can get quotes from various insurers. Also, some insurance aggregators allow you to compare prices from different insurance companies on their websites. If you are happy with your current car insurer and have been insuring with them for some years, still it’s not a bad idea to cross-check other companies’ prices.
3) Choice of the vehicle
It is common knowledge that a more expensive car would have hefty premium compared to a small and inexpensive car. As the chances of a theft of a premium car are high, the premium prices also increase proportionally. Also, the spare parts cost is expensive in case of luxury cars. For example, the premium for a Porsche would me many times higher compared to a Wagon R car.
4) Opting for deductibles
To lower your premiums or gain discounts, you can opt for deductibles. This way your car insurance premium will reduce by up to 35%. Insurance companies allow a discount for those people who are willing to bear some burden in case of a claim. The higher the deductible amount taken, the bigger will be the discount amount offered.
5) Older cars will have higher premiums
When a car becomes old, it starts to have some issues. Insurance companies also know this truth. That’s why they prefer to insure newer models and recently purchased cars compared to an older car. Also, some car brands are very sturdy and have a high resale value which provides them with a favourable premium compared to damage prone cars.
After understanding various factors that determine the increase or decrease of the car insurance premium, hopefully it will become much easier for you to decide on how you can reduce your car insurance premium.