As hard working individuals, all of us understand the significance which money holds in our life. Given the rising cost of living, the phrase, ‘a penny saved, is a penny earned’ definitely holds greater meaning than ever before in the common man’s life now. On a routine basis, an average person has to take care of a number of expenses like groceries, commuting, utility bills, children’s school fees, loan repayments, insurance premiums, etc.
Speaking of conveyance, car insurance premiums, like any other insurance premium, can really put a dent in your monthly budget. However, it is also something which is necessary in order to ensure the safety of you and our vehicle in case the unforeseen happens. The good news is that there are ways in which you can save on motor insurance premiums, in a few simple ways.
Before you settle for a particular insurer, do your homework. Go online and compare premiums set by different motor insurance companies. Insurance premiums may differ with different types of motor insurance policies and also with the extent of cover they provide. Usually, a no-frills insurance policy comes out to be the cheapest. However, as features and covers get added to the policy, the premium amount automatically goes up. Also, make sure that you read the fine print of the policy carefully before deciding upon it as it may have details about any hidden charges or the like.Evaluate Voluntary Deductions
In insurance jargon, voluntary deduction is basically the sum one is required to pay in case there is an accident. In case your voluntary deduction is nil, then you shall receive the entire claim amount in case of an accident. However, if your policy specifies a certain amount towards voluntary deduction, then, that is the amount you’ll have to pay, while the insurer pays the balance amount, in case of an accident. The way it works is, that the higher your voluntary deduction, the lower the car insurance premium amount shall be. However, when it comes to voluntary deductions, one must be careful and evaluate all the possibilities.Anti-Theft Devices May Help Lower Premium
Anti-theft devices serve a dual purpose when it comes to motor vehicle usage. First, they protect you and your vehicle from theft and second, they help bring down your insurance premium amounts. The presence of safety features like air-bags, etc, can positively affect your insurance premium determination by insurers.Forego Claims On Small Expenses
As is customary, if a person doesn’t make any claims on their motor vehicle insurance policy during a policy year, that entitles them to a No Claim Bonus (NCB). The NCB amounts roughly around 20%. This means that in case you avail a No Claim Bonus after one policy year, then you are eligible to a 20% (or any percentage corresponding to that of the NCB) premium for the next year. However, if you make claims for any small charges, like minor repairs, from your insurer, then you shall stand to lose that NCB. In the end, you must weigh the amount of the NCB which you are likely to earn as opposed to the cost of repairs that you wish to make a claim for. Also, it is helpful to know that the No Claim Bonus shall only increase with every passing year, which means that the longer you go without making a claim, the more you will saving on insurance premiums.Do Not Let Your Policy Lapse
A policy lapse means that you shall no longer be eligible for a No Claim Bonus. Therefore, it is helpful to either put a reminder for your policy’s expiration date or you could opt to receive a reminder sent by your insurance company itself.Installation of Expensive Gadgets Could Up Your Premium
Installation of any costly gadget to your vehicle could very well hike the premium amount. Also, any modifications made to the vehicle by way of alloy wheels, rear spoilers, exterior modifications, etc., are likely to affect the premium. The reason for this being that, the insurer may evaluate your driving style based on the modifications done to the vehicle and the result may not be entirely favorable, especially with regard to setting the premium amount.Consider Joining Road Safety Organizations
Membership of organizations like Automobile Association of India, which promote road safety, is also quite advantageous when it comes to auto insurance premiums. Besides other benefits, you can also get a concession on your car insurance premium amount.
Given the hazardous driving conditions prevailing nowadays, motor insurance has been made mandatory for all vehicles. Not only does it ensure your safety but also that of your vehicle and any other party involved in case of an accident. After all, each life is as invaluable as the next.
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GST Update: GST of 18% is applicable on car insurance effective from the 1st of July, 2017