As per the Motor Vehicles Act, buying a motor insurance policy is necessary for every car owner in Some Countries (Like India). Though a motor insurance coverage is imperative, the premium, however, might vary from time to time. For example, when you purchase a policy at present for a certain premium, that is probably not the same next yr. There are numerous factors that affect the premium of the policy, such because the Insured Declared Value (IDV) of the car, No-Claim Bonus (NCB), add-ons, and so on. due to which most end up paying a higher premium while renewing their insurance policies.
To keep away from paying an extra premium, there are a couple of normal things you should bear in mind, although all insurance firms follow a special process for calculating policyholders’ motor insurance policy premiums.
If you’re going to renew your vehicle’s insurance policy, here is how you can decrease your premium:
Think about Add-ons(necessary or not)
Having related add-ons with a base insurance policy cover gives you an overall cover. For example, a vehicle(car) policy add-on like zero depreciation, engine safety will assist you keep away from paying a higher premium in the long run and also cover you from such damages and secure yourself. Remember that add-ons will instantly increase your premium costs when added to a regular motor cover. According to specialists, consider it and make a call based on your needs while choosing such add-on covers.
Maximum Try to Avoid Lapse of policy
You can avoid lapse of insurance policy, by making payment of dues on time to time. If a policyholder misses the last date for their insurance policy renewal, Policy firms usually inspect the vehicle, after which normally insurance corporations cost a higher-cost premium by means of this inspection. Therefore, specialists say it is better to avoid lapsing vehicle insurance policy. Moreover, policyholders additionally lose their NCB completely, if the policy payment lapses for more than 90 days.
Be Aware About No-claim Bonus (NCB):
No-claim bonus is provided to policyholders by the insurance company after they don’t make any claim under the main policy. The NCB normally goes as excessive as 50 % for 5 claim-free years, even though it depend from company to company. In case the policyholder makes a claim, the no-claim bonus is reset to zero, leading to a higher insurance policy premium. Therefore, you should drive carefully to prevent yourself from making any claim.
Insured Declared Value (IDV)
Depending on the age of the automobile, the insured declared value is decided by the insurance company at the time of renewal. The IDV is calculated based on the age(years) of utilizing the car, along with depreciation which is applied to the ex-showroom price on vehicles(cars, Bikes, etc) up to 5 years outdated. For older vehicles, the market price is taken as the IDV of such vehicles. Hence, try to set the proper ‘vehicle value’ on which the insurance policy is bought.