Insurance is like a spare tyre. You may not require it, but not having one is not an option.

How Car Insurance Calculator Gets You Best Coverage

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A car insurance calculator is an online facility that enables you to get quotes on car insurance from multiple insurance companies in India. When you are looking to buy car insurance, the first thing to do would be to get familiarised with the different types of coverage available in the market. Once this is done, you should ideally compare insurance plans between providers to narrow down on the most suitable cover for your specific insurance needs.

Calculation Of Premium:

Car Insurance Calculator

The premium for car insurance is calculated based on several factors:

  • The Insured Declared Value (IDV) of the car
  • The cubic capacity of the vehicle’s engine
  • The year of manufacture of the car
  • The area of registration of the vehicle
  • The No Claim Bonus (NCB) accrued under the policy

When a brand new vehicle is driven out of a showroom, its value will start depreciating. Over a period of time, the depreciation will increase bringing down its IDV. In other words, an 10-year old car will have a much lower IDV than a brand new vehicle of the same make and model.

Although the premium for car insurance depends on the IDV of the vehicle itself, there are several other factors that come into play when calculating this value. So, we cannot conclude that it will be more expensive to insure new cars when compared to old ones.

Car insurance premium is calculated based on the formula given below:

Final quote = Own-damage premium + Third-party liability premium + premium for add-on covers - NCB and other discounts

The car insurance calculator available at neutral financial websites uses this generic formula that gives you a premium quote closest to the amount you will be paying when you buy a policy from a specific insurer.

Third-Party Liability Premium Is Fixed:

The Insurance Regulatory and Development Authority of India (IRDAI) decides the premium for third-party liability coverage under motor insurance on an annual basis. The values for the financial year 2017-18 are as mentioned below:

Private car engine capacity Premium from 1 April 2017
Below 1,000 cc Rs.2,055
More than 1,000 cc but less than 1,500 cc Rs.2,863
More than 1,500 cc Rs.7,890

Own-Damage Premium - What It Encompasses:

The own-damage premium in car insurance is based on the IDV of the vehicle that is, in turn, dependent on the age and depreciation of the car. Each insurer would have predefined guidelines on calculating this value.

Listed below are the key factors that affect your own-damage premium:

  1. The type of vehicle - The make and model of the car has a bearing on the premium quoted. For instance, high-end cars are more risky to insure as they are more prone to theft and it will be more expensive to repair damages on them. Hence, owners of these cars will have to bear higher premiums.
  2. Modifications to the vehicle - If you have made any alterations to the car it is important that you inform the insurance company of the same. Modifications to the vehicle can increase or decrease the risk to the insurer; so such changes will have to be reviewed by the insurance provider. There may be subsequent alterations in the premium as well. In case you fail to inform the insurer, they may not honour your next claim and void the coverage altogether!
  3. The type of fuel used in the vehicle - The fuel type used in the car affects its insurance premium. So pay close attention to this when you purchase a car.
  4. Coverage chosen - If you have taken limited insurance coverage your premium will be low. However, opting for a comprehensive car insurance policy with add-on covers will bring up the premium. So, pick the insurance coverage carefully by assessing your needs in detail.
  5. Insured Declared Value - The depreciation on every vehicle is fixed based on industry guidelines, as shown below:
Age of the car Percentage depreciation
Less than 6 months 5%
Between 6 months and 1 year 15%
Between 1 year and 2 years 20%
Between 2 years and 3 years 30%
Between 3 years and 4 years 40%
Between 4 years and 5 years 50%
Above 5 years This is calculated based on a mutual agreement between the insurer and the policyholder

The IDV of the vehicle is determined by the rate of depreciation mentioned above. The vehicle’s condition is also taken into account for the same. The assessment or survey is done by insurance surveyors or dealers.

  1. Discounts offered by the insurer - No Claim Bonus is a benefit offered to a policyholder who does not raise any claims during the policy term. This is like a reward for being a good driver. The NCB can translate into an irresistible discount of up to 50% on the renewal premium! So, it is recommended to preserve the NCB by not raising claims for small damages. The rate at which a car owner earns NCB is as detailed below:
Claim-free years NCB, as percentage of own-damage premium
1 year 20%
2 years 25%
3 years 35%
4 years 45%
5 years 50%

Another noteworthy discount is the premium reduction you are liable to receive by opting for a voluntary excess. This deductible is the amount you agree to pay upfront at the time of a car insurance claim. Although this brings down your renewal premium by a significant amount, you should be careful to not overstate this value, as you may have difficulty honouring the agreed payment at the time of a claim.

Insurance companies also give discounts to customers who have valid memberships in automobile associations across India. Age-based discounts, bundling discounts, and discounts for anti-theft device installation are other deductions offered on premium.

  1. Area of registration - If you stay in a locality where theft is common, you will have to pay higher premiums. Even parking your vehicle in a dangerous zone may jeopardise your eligibility for insurance coverage. Also, staying in an accident-prone area will attract higher car insurance premium.
  2. Customer demographics - Other factors that affect the premium are demographics such as the marital status, occupation, and gender of the customer.

Why Is It Important To Use A Car Insurance Premium Calculator?

As is the case with all financial products, it is very important to do a good amount of research before buying a car insurance policy. Listed below are some advantages of availing the services of this tool:

  1. It helps you make a better decision as far as insurance purchase is concerned. You will also have good knowledge of the coverage offered by different insurers and the corresponding costs.
  2. The entire policy comparison process is simplified to a great extent.
  3. You need not furnish any paperwork for policy comparison; hence, it is hassle-free.
  4. You can get an overall view of the available insurance plans in the market.
  5. Some websites enable you to go one step further and buy car insurance instantly with limited paperwork. You may also get attractive premium discounts for buying insurance online.

What Information Needs To Be Updated For Car Insurance Premium Calculation?

The following details are usually required to get quotes through the car insurance premium calculator:

  • Make and model of the car
  • State of registration and date
  • Year of manufacture of the car
  • Type of vehicle insurance, i.e., private or commercial

If you are buying insurance for a used car, you will have to update the details of the existing car insurance policy, details of previous ownership, and claim history. It is important that you furnish accurate information in the calculator facility; else you may not receive the best deals out there. Apart from these, you will also have to update some personal details such as your age, name, and profession.

What Is Car Insurance Renewal Premium Calculator?

The car insurance premium calculator facility can also be used at the time of policy renewal. In fact, it is highly encouraged that you look around for better deals in the market at the time of policy renewal. You can use the car insurance renewal premium calculator facility and get an idea of the coverage offered by different insurance companies and the corresponding costs.

However when you are looking to renew your policy, the premium is not the only thing that you should consider. It is important to understand the claim settlement history of the insurer and the efficiency of its customer service department.

You should also review your updated insurance needs and decide on the coverage you actually require at the time of renewal. During this exercise you may find out that a limited insurance cover would suffice for you for the next year. This way you can save on premium by cutting down on the coverage without actually having to shift insurers.

If you are planning to buy/renew auto insurance anytime soon, the car insurance calculator facility is an inevitable part of your purchase journey. You would be aware that this facility is offered without any additional charge at neutral financial websites. So it is imperative that you familiarise yourself with this tool and make a judicious purchase.

Car Insurance Reviews

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  • ICICI Lombard Car Insurance
    "Best Policy"
    0.5 5.0/5 "Blown Away!"
    I got Car insurance from Icici Lombard general insurance through As The premium amount is nominal one am satisfied with it , as it has low premium amount with cashless garages comprehensive cover with bumper to bumper coverage .Customer service and response is good . I pay it annually through online banking
    Was this review helpful? 0
    , chennai
    Reviewed on Feb 15, 2019
  • Royal Sundaram Car Insurance
    "Not satisfied with the service"
    0.5 1.0/5 "Really Bad"
    I had taken this insurance policy a while back and the experience with them has not been that good. For making the claim it had taken almost 20 days which was not good and it was not convenient. The services of then has to be improved and their customer care has to be improved and the staffs should be more responsible.
    Was this review helpful? 0
    , hyderabad
    Reviewed on Feb 13, 2019
  • HDFC Ergo Car Insurance
    "Excellent Policy"
    0.5 3.5/5 "Pretty good"
    I had taken this insurance policy a long time back and i had been paying the premium on an annual basis. The premium amount was around 30,000 and the payment method has been simple. There has been a single claim which i had made so far and the services where very good and there has not been any difficulty faced.
    Was this review helpful? 0
    , hyderabad
    Reviewed on Feb 13, 2019
  • Royal Sundaram Car Insurance
    "Satisfactory"
    0.5 4.5/5 "Excellent!"
    I have chosen Royal Sundaram for car insurance and done a online comparison. I have received the insurance paper. The premium was reasonable and the policy period is one year. They have good garages and also they are giving me n-number of claims can be done in a year. It is a comprehensive plan.
    Was this review helpful? 0
    , ghaziabad
    Reviewed on Feb 13, 2019
  • review Car Insurance
    "Average "
    0.5 3.0/5 "Satisfactory"
    I took my car insurance in Kotak General Insurance because I have account with them. The premium was reasonable. The claim experience was bit tough and it was not beneficiary. The customer service was good but need to improve the garages for cashless. The policy coverage was good but my experience was not satisfactory.
    Was this review helpful? 0
    , ghaziabad
    Reviewed on Feb 13, 2019
  • Shriram Car Insurance
    "Good"
    0.5 3.0/5 "Satisfactory"
    I took my car insurance in Shriram General Insurance before 3 years. Its not purchased based on the premium because one of my relative is working here. The customer service was good. The policy coverage is also good. It is a one year policy and first party insurance.
    Was this review helpful? 0
    , hyderabad
    Reviewed on Feb 13, 2019
  • Reliance General Car Insurance
    "GOOD POLICY"
    0.5 4.0/5 "Great!"
    I have taken the car insurance policy with the RELIANCE GENERAL INSURANCE where the premium is nominal when compared to the others also the IDV value is good with this policy. They have provided the policy coverage of bumper to bumper with this policy.
    Was this review helpful? 0
    , namakkal
    Reviewed on Feb 12, 2019
  • United India Car Insurance
    "GOOD"
    0.5 4.0/5 "Great!"
    I have taken the car insurance policy with the UNITED INDIA INSURANCE where i have no claim experience with this insurance policy. I am using it since from last 3 years where the premium is lower compared to the others along with that they offers good IDV value.
    Was this review helpful? 0
    , new delhi
    Reviewed on Feb 12, 2019
  • review Car Insurance
    "Smart protection"
    0.5 4.0/5 "Great!"
    My showroom guy issued car policy from Bharati Axa, I didn't compare the cost of the policy. Its zero depreciation plan, bumper to bumper protection is there. They give 24 hours service, road side assistance its all standard. With best IDV on my Honda I20 car.
    Was this review helpful? 0
    , thane
    Reviewed on Feb 12, 2019
  • New India Car Insurance
    "Best policy"
    0.5 5.0/5 "Blown Away!"
    I took car insurance with New India Assurance for 1 year, a premium of Rs 5000 has to be paid for this insurance policy. There was no claim experience so far with this insurance. This policy has full coverage and the customer service is very good.
    Was this review helpful? 0
    , nasik
    Reviewed on Feb 11, 2019
  • Bajaj Allianz Car Insurance
    "Its Good but they need to provide less claim settlement"
    0.5 5.0/5 "Blown Away!"
    Bajaj Allianz cost of the car policy is reasonable, last year I paid the amount of Rs. 9000, now I need to pay Rs. 10,000 it has the benefits of zero dep and two times I have claimed it, first time my front mirror got damaged then second time back bumper got damaged. Only I paid the fine of Rs. 1000. Remaining they have taken care but claim settlement value is less, it should be 100%.
    Was this review helpful? 0
    , new delhi
    Reviewed on Feb 11, 2019
  • ICICI Lombard Car Insurance
    "Good"
    0.5 4.0/5 "Great!"
    I have purchased car insurance with ICICI Lombard. The premium was less when compared to others. I am using the service for one year. It is a third party insurance and it has bumper to bumper offer with zero dep and road side assistance. I have no claim and the hard copy have not received. I paid 13K through online to purchase the policy.
    Was this review helpful? 1
    , chennai
    Reviewed on Feb 09, 2019
  • Iffco Tokio Car Insurance
    "Good"
    0.5 3.5/5 "Pretty good"
    I am having a car insurance with Iffco Tokio. There is no claim experience. I have paid almost 10K for an insurance. My car is 3 to 4 years old, I think road side assistance is available. It is a first party insurance. The online payment is okay and very tedious.
    Was this review helpful? 1
    , gurgaon
    Reviewed on Feb 09, 2019
  • HDFC Ergo Car Insurance
    "Its Good"
    0.5 4.0/5 "Great!"
    When I was with HDFC Ergo, at the time the premium was reasonable for the car insurance, I have availed comprehensive third party with zero depreciation plan. Means its covered from front bumper to back bumper. I don't have any claim. However it has the 24 hours service , road side assistance.
    Was this review helpful? 0
    , bangalore
    Reviewed on Feb 09, 2019
  • HDFC Ergo Car Insurance
    "Smart Protection"
    0.5 4.0/5 "Great!"
    I have comprehensive plan its covers 100% of vehicle parts, I have renault duster, the IDV value is based on the year that I have purchased. They insurer got tie up with many showroom and centers in my area. 24 hours service available for breakage, no claim benefits are also applicable.
    Was this review helpful? 1
    , bangalore
    Reviewed on Feb 08, 2019
  • Iffco Tokio Car Insurance
    "Good"
    0.5 4.0/5 "Great!"
    I do have a car insurance with Iffco Tokio and my car is 5 years old. This is the only insurance company who can provided me a zero dep. The customer service was good. There was no claim experience till now. They do give a reminder call at the time of renewal. It is a first party insurance. Their policy coverage is also good.
    Was this review helpful? 0
    , new delhi
    Reviewed on Feb 08, 2019
  • Tata AIG Car Insurance
    "Need Improvement"
    0.5 4.0/5 "Great!"
    Last year I had policy from Tata Aig, the cost wise they are higher, I got 40% cheaper price in ACKO insurer for my car policy. However the benefits are same like idv and the pre pick up from t he zone, tyer claim and complete interior, zero dep, bumper to bumper benefits. Tata Aig claim percentage is low, two year back I had claim it was small accident they delayed the process, at last I got the vehicle after 15 days it was cashless I done lots of follow up.
    Was this review helpful? 0
    , bangalore
    Reviewed on Feb 07, 2019
  • HDFC Ergo Car Insurance
    "Trusted Insurer"
    0.5 5.0/5 "Blown Away!"
    Long back I had HDFC Ergo for my car, at the time they gave me best insured declared amount for my Maruthi car and the insurer got tie up with many centers. I never met any claim with them. During renewing or purchasing the plan the customer support is very helpful.
    Was this review helpful? 0
    , bangalore
    Reviewed on Feb 07, 2019
  • Bajaj Allianz Car Insurance
    "Good Experience"
    0.5 5.0/5 "Blown Away!"
    The claim process was good, the response is very good with Bajaj Allianz . My car got damaged in the first portion they done some painting, then I paid the nominal charges of Rs. 1000, remaining the insurer took care. I have VOLKSWAGEN AMEO, the premium amount was Rs.15,000 for one year. Its a normal third party insurance for my car.
    Was this review helpful? 0
    , hyderabad
    Reviewed on Feb 07, 2019
  • National Insurance Car Insurance
    "Good"
    0.5 5.0/5 "Blown Away!"
    I had a car insurance with National insurance for one year and it was good. I had no claims with them. There was no reminder call from the customer service at the time of reasonable. The premium was okay but its quite high when compared to Bajaj Allianz.
    Was this review helpful? 0
    , ahmedabad
    Reviewed on Feb 04, 2019
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