What Should You Consider When Buying or Renewing Car Insurance?
The decision to purchase car insurance can be difficult. There are many options available, and it is essential to make the best choice for your needs.
Car insurance is something that most people know they need, but it can be hard to find the right one. You want to make sure you have a policy that meets your needs, so you have peace of mind from day one! When evaluating vehicle insurance companies and plans, there are several aspects to consider, including cost, coverage, protection, and customer service and satisfaction ratings.
In this article, we will go over the critical factors for consideration before buying or renewing car insurance so you can choose the best option for your situation.
1. Insurance Coverage
A car insurance product is not just a contract between you and an insurer. It’s also about the coverage that your chosen plan offers. The best way to ensure that you’re getting the right coverage for your needs is to study all of them carefully before committing to anything.
For example, third-party liability insurance covers you against any third-party claims while comprehensive insurance covers any damage or loss to your vehicle, as well as any third-party liabilities.
Note: According to the Motor Vehicles Act, 1988, it is mandatory for you as an Indian driver to have valid third-party car insurance to drive your car on the Indian roads.
2. Amount of Premium
A car is a significant investment, so it is important to understand how much insurance coverage you need. Different people have different needs, so you need to know what they are before choosing a price range. Many factors go into determining the risk of your car and how much coverage it will need.
Tip: Understanding your car’s possible hazards can help you determine how much coverage it needs. The higher the level of coverage you choose, the higher the cost of the premium.
3. NCB discount
No claim bonus is a type of consumer incentive that insurance companies offer their policyholders if they have not filed any claims during the last year. The NCB discount rate is 20% for the first year and then increases to 50% for the fifth year in a row. You should consider this before buying a plan, as it may help in reducing the total renewed premium.
Note: Existing NCB discounts can be transferred to other vehicles as long as you are the policyholder for both cars.
4. IDV Amount
The term “Insured Declared Value” (IDV) refers to the amount of money that an insurance company will pay out if your car is totalled and written off as a total loss. By eliminating depreciation factors from this calculation, you will have a more accurate estimate of how much money you can get in major claims.
5. The Reputation of the Insurance Company
In today’s fast-paced society, people want to do as much as they can in the shortest amount of time. This is why it is essential for everyone who needs an insurance plan to shop around and find a company that will offer them the best rates available. However, not only should you go with the cheapest company out there – you need to make sure that your provider has a good reputation and offers fair claims settlement processes.
Note: According to the Insurance Regulatory and Development Authority of India’s (IRDAI) strict requirements, all reputable insurance businesses must have a QR code app. Because consumers receive regular updates on their insurance policy via the app, the QR code validates the policy’s validity.
6. Add-Ons Available
Car insurance is an essential investment for car owners as it protects them against any financial loss in case of car accidents or other unforeseen events. However, car insurance doesn’t cover everything, and there are a few additional car insurance add-ons that will help protect your car from any loss. These car insurance add-ons include zero depreciation coverage, consumables, engine protection, and key and tire protection, just to name a few. Each of these add-ons covers different aspects.
Make sure you check the available options and add those best suited for your four-wheeled beauty before you opt for the same.
7. CSR Record
It’s important to know that not all car insurance companies are the same, and some of them have better records than others. One way to check out an insurer’s record is by looking at their claims ratio, defined as the percentage of insured vehicles that were damaged in a collision compared to the total number of claims filed against that particular company.
You should look for a car insurer who has a high CSR because this means they’ve settled more claims than other companies.
8. Garage Network
Major automobile insurance companies have a reputation for only allowing cashless claims if your car is fixed in one of their network garages. As a result, it’s a good idea to look over the list of garage networks before deciding.
Tip: A seamless claim is the best customer experience for any insurance plan, and this is where a network garage comes in handy. So, remember to check the list so that garages on remote locations and nearby ones are on the list before you purchase or renew your car insurance plan!
9. Insurance Portability
A car insurance provider can be one of the best in the market, but if it does not suit your needs or you find better options with another insurer, you should switch car insurers for your car instead of renewing with the same company. Insurance portability refers to the ability to effortlessly move between insurance carriers before choosing the one that best meets your needs.
Note: So, at the time of renewal, if you are not happy with your current insurer, you may choose to change it by porting it without disrupting the continuity benefit.
Car insurance can be challenging to get a hold of, and it’s even harder when you’re not sure what you need. There are so many factors to consider when deciding which car insurance company will suit your needs best, and it can be hard to find the right one for you. It is easy to get overwhelmed with all the options available. Understanding the above-mentioned vital points will make it much easier when researching car insurance companies and policies.