Many of us understand that having adequate car insurance is prudent. While it is mandatory by law to have a third party insurance cover when you own a car, it also offers you peace of mind that you have financial backup in case your vehicle gets damaged due to an accident. Whether you are about to buy new car insurance online or it is time for car insurance renewal, there are a number of tips that can help reduce the car insurance premium that you pay.
Prices for car insurance policies vary from company to company, so it is always a good idea to shop around before you buy.
Ask friends and relatives for recommendations, take insurance quotes from your preferred insurance company, and if need be, then use an insurance platform which allows you to compare different policies. Make sure you thoroughly compare the inclusions and exclusions of each policy besides the premium; make sure you have done the required research before you commit yourself to any policy.
Understand the jargon and the basic stipulations of car insurance so that you know what to look for. Another thing that you would do well to remember is the fact that the lowest premium should not be the sole criterion to select a car insurance policy. It goes without saying that you would want the premium to be affordable, but at the same time, ensure that the insurance provides adequate coverage. Look for the best car insurance company that is reputable, and has a good claim settlement ratio.
Think about Insurance Costs before you buy a Car
Motor insurance premiums are fixed based on a number of different factors, of which, the make, model, market value of the car, average costs of repairing that car, etc. are a few. Before you buy your car, it is a good idea to assess the average insurance premium rates for that model, as that is going to be a key part of your car ownership.
Raise your Deductible
A deductible is a pre-decided amount of money that has to be paid by the car owner in case of a claim. Only after the owner has paid the deductible will the insurance company pay the rest of the claim amount. If you opt to choose for a higher deductible on your car insurance, you can significantly reduce the premium. However, you should take this step only if you have enough money set aside to pay a higher deductible in case you have to file a claim.
When you have an Older Car
Considering the amount of depreciation that an older car has, comprehensive cover may not be enough, especially if you are paying much more out of your pocket than the insurance company for any accidental repair. There are a number of insurance companies which offer zero-depreciation cover for cars which are up to 6 years old. Keep a lookout for such options to well-insure your car.
Having a Good Credit History
Having a good credit history has a number of benefits, including low insurance premium costs. Many companies take your credit history into account while calculating the car insurance premium.
If you are younger than 25 years of age, there is a chance that your insurance company will charge a higher premium. However, you can get these costs reduced by adding named drivers to the policy. People who are older than you and have a clear driving licence and record can be added as named drivers to the policy.
As long as you are the one who’s mainly driving the car, there is nothing wrong with adding extra drivers to your policy.
It is a very tempting idea to just pay for your car insurance renewal and stick with the company you are with. However, a month before your insurance is about to expire, take out the time to review your existing car insurance policy. Simultaneously, also search for car insurance online. Receive quotes from different companies and compare the benefits before you buy. For all you know, the best car insurance company for you may be just around the corner, but you keep missing out on it because you don’t research. There are also several comparison websites out there that you can use to compare multiple policies at once, to find the one that suits your needs the best.
Join a Club
There are a number of enthusiast clubs for a number of cars and models, and it won’t be that hard to find one for your car. There are several benefits of joining such a club, some of which are:
Discounts of Motor Insurance – Many of the clubs offer discounted insurance through insurance companies affiliated with them;
Lower costs – You get to learn more about your car; the best way to drive it, easy fixes for common issues, etc., which helps in reducing overall costs;
Community – Such clubs are a great way to meet new people and make new friends.
Avoid making Frivolous Claims; build up your NCB
Many a times we tend to make claims which can very well be paid out from our own pockets. While your insurer will honour such claims, it also means not taking advantage of No Claim Bonus (NCB), which is a kind of discount which your insurer gives for not making a claim during a given policy year. Furthermore, this NCB can keep getting accumulated every subsequent year you don’t make a claim, and can go up to 50%. This in turn helps lower your annual car insurance premium, which reduces your car ownership cost. Therefore, not making frivolous claims is a prudent decision in the long term to help save more on your car insurance premium with NCB.
Car insurance is one of the most important aspects of owning a car. Make sure you utilize these tips to avail lower premium costs, so that you don’t have to compromise with the safety of your car.