When it is time to renew your car insurance, your first instinct would be to simply pay off the premium upfront and continue with the same insurance provider. It is understandable that the hassle of searching, shortlisting and finalizing a new plan is not something you want to do. But why make that costly mistake when you could do better by changing the plan or company? There have been cases where people had saved up to 50 percent of the yearly premium just because they took the effort. Most ombudsman in the field strongly recommends choosing a new policy at least every third year. That is, only if you find a better deal without any gap in your existing cover.
The most tried and tested but emphasized tips in this regard are given below:
- Look around:
Most car insurance plans are created with a validity of six months or one year. The best time to shop for plans are when you shift your house, when you purchase a new car, or a month or so prior to renewing the policy.
- Compare car insurance rates: Comparison of various automobile insurance schemes has never been easier. There is a slew of comparison websites which will show you the rates of all the plans provided by every insurer there is. Choose a cover that suits your needs and budget.
- Ask questions:
It is essential that you ask about things like how much liability protection, medical and legal cover there is with car insurance. And if the assured amount is enough to cover potential damage. You can approach the company directly or independent agents.
- Bargain with the current insurer:
If you give an idea that you are planning to switch your car insurance to snatch a lower premium to your current insurance company, the chances are that they will offer you a strong deal. Each client lost is a business lost to them. They are sure to give you a lower quote than the rival firm.
- An eye on the discounts, please:
Don’t miss out on discounts and rebates. For instance, you are eligible for rebate if you have already bought another plan (home insurance, life insurance etc.) from the same firm. Also, do not forget to ask for Car Insurance No Claim Bonus if you haven’t made any motor insurance claim in the past year.
- Are there switch penalty?
Some companies can charge you for switching car insurance before the policy expires. This is why you must always go through the fine print. You can evade this if you inform them in advance. Then your whole unused premium will be reimbursed. Hence, if you are terminating in the middle of the tenure, make sure to ask about possible fines. If there is, do the math and decide if it is prudent to switch at the time.
- Study the new insurer:
Before you sign up for anything please check the reputation of the motor insurer. Going through customer columns or talking to other customers of theirs can give you an idea.
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GST Update: GST of 18% is applicable on car insurance effective from the 1st of July, 2017