5 Factors Affecting your Car Insurance Premium you could be Missing

There are times when despite owning the same vehicle and having the identical parameters, your friend next door and you pay different amounts for your respective car insurance premiums. Now, you must be wondering why? This article will help you in understanding what the factors are that affect your car insurance premium.

Read more


Compare & Save upto 85%* on Car Insurance
Processing
Get Car Insurance starting
@ only 2094/year#
  • Renew Policy In2 Minutes

  • 20+ Insurers To Choose From

  • 51 Lakh+ Vehicles Insured

#TP price for less than 1000 CC cars. All savings are provided by insurers as per IRDAI approved insurance plan. Standard T&C apply.

Car Insurance Premium Price

New India Assurance

Cashless Garages

253

Plan type

Comprehensive

Starting from

₹ 2,727

Check premium
Claim Advantage
  • Self-Video Claims
  • Reimbursement Within 7 Working Days For Non-Cashless

National Insurance

Cashless Garages

268

Plan type

Comprehensive

Starting from

₹ 2,757

Check premium
Claim Advantage
  • Self-Video Claims
  • Reimbursement Within 7 Working Days For Non-Cashless

Bajaj Allianz

Cashless Garages

1024

Plan type

Comprehensive

Starting from

₹ 2,868

Check premium
Claim Advantage
  • Spot Claims Upto Rs. 30,000
  • Repair service at select cashless garages

DIGIT

Cashless Garages

Repair Anywhere

Plan type

Comprehensive

Starting from

₹ 2,962

Check premium
Claim Advantage
  • 6-Month Repair Warranty
  • Advance claim payment
  • Free Pick-up & Drop

Oriental Insurance

Cashless Garages

258

Plan type

Comprehensive

Starting from

₹ 3,005

Check premium
Claim Advantage
  • Self-Video Claims
  • Reimbursement Within 7 Working Days For Non-Cashless

DIGIT

Cashless Garages

Repair Anywhere

Plan type

Third Party

Starting from

₹ 2,094

Check premium
Claim Advantage
  • Covers damages to third party property
  • Covers damages to third party person

Bajaj Allianz

Cashless Garages

1024

Plan type

Third Party

Starting from

₹ 2,094

Check premium
Claim Advantage
  • Covers damages to third party property
  • Covers damages to third party person

Oriental Insurance

Cashless Garages

258

Plan type

Third Party

Starting from

₹ 2,094

Check premium
Claim Advantage
  • Covers damages to third party property
  • Covers damages to third party person

National Insurance

Cashless Garages

268

Plan type

Third Party

Starting from

₹ 2,094

Check premium
Claim Advantage
  • Covers damages to third party property
  • Covers damages to third party person

New India Assurance

Cashless Garages

253

Plan type

Third Party

Starting from

₹ 2,094

Check premium
Claim Advantage
  • Covers damages to third party property
  • Covers damages to third party person
See more plans

Above-mentioned prices are for a 7-year-old Maruti WAGON R AVANCE LXI (998 CC) registered in Gurgaon and 15 days before expiry of previous policy

Not just one but many factors are considered while calculating your car insurance premium, particularly at the end of auto insurance providers. Two of the most important factors are your Voluntary Deductibles and making a decision for a low insurance coverage.

Apart from these two factors, your auto insurance premium is affected by various other factors as well. Knowing such factors can be very helpful for you to make a wise decision.

Below mentioned are 5 significant factors that affect your auto insurance premium:

1. Geographical Location

Your area of residence reflects your lifestyle since you share a direct relationship with the location. The city of your vehicle registration influences the premium you will have to pay for your auto insurance. Insurance providers have classified various locations across the nation as the 'Insurance Zones' basis the automobile’s exposure to the risk associated with your location.

Generally, these zones are the metro cities along with the rest of India. In metro cities, there is a high rate of accidents and vandalism. In case you are residing in a metro city, then you will have to pay a higher premium for your car insurance as compared to someone who is living in a less developed and lesser populated city.

For example, if you purchase an auto insurance plan with zero depreciation add-on for your brand new car in a semi-urban locality, you would have to pay 3 percent to 5 percent less as compared to purchasing the exact plan in a metro.

2. Kind of Insurance Cover

There are two types of car insurance plans - third-party car insurance and comprehensive car insurance. In the former, the coverage is applicable only for the damages caused to a third party involved in any road mishap. It doesn’t provide any insurance coverage to vehicle owner/driver or the insured vehicle.

In the latter, the insurance coverage is provided for the damages done to both the parties involved in any road mishap, including your own automobile.

There are people who go for the third-party insurance coverage, as its premium is lower when compared to that of a comprehensive insurance plan. For instance, for a new Hyundai i10 GLS Asta, the third-party insurance premium would cost somewhere between Rupees 3,200 to Rupees 3,500. The insurance premium for a comprehensive policy for the same four-wheeler would cost somewhere around Rupees 10,000 to Rupees 15,000. The specific calculation depends upon the add-on riders you opt for.

You may like to Read: Comprehensive Vs Third Party Car Insurance

3. The Type of Engine

The vehicle insurance premium is calculated on the basis of two elements - third-party coverage and own damage coverage. The calculation of third-party cover is based on the cubic capacity (cc) of your vehicle’s engine. The computation of own damage cover is based directly on the Insured Declared Value of your vehicle. In simple terms, the insurance premium amount for a 1000 CC engine vehicle would be lesser than that of a vehicle with 1500 CC engine.

4. Extra Layers of Security

You brought an insurance plan in order to safeguard your vehicle from the possible risks. If your vehicle is equipped with security devices, such as gear lock, handle lock, airbags, GPS tracking device etc., the risk of your vehicle being stolen decreases drastically. Insurance providers consider your efforts towards ensuring the security of your car while calculating the insurance premium. It might offer you a discount on the own damage premium.

Keep in mind that this discount would apply if the installed security equipment is authenticated by the Automotive Research Association of India.

5. Car Modification

Generally, car accessories like roof rails, spoilers etc. aren’t covered in the car insurance plans. In case you want insurance coverage for that as well, get it installed by your car dealer when you purchase it. Your car dealer would include the charges of such accessories in the price of your vehicle. It would be helpful for you in order to get a high Insured Declared Value from your insurance provider.

At the same time, keep in mind that it would hike your car insurance premium.

A car insurance plan is for a specific duration; it’s recommended to do a research about these 5 important factors that affect your car insurance coverage before you finalize an insurance plan for your car.

Written By: PolicyBazaar - Updated: 26 June 2021
You May Also Like
  • Transferring Car Insurance from One Person to Another

    Transferring Car Insurance from One Person to Another An integral part of selling a car, for both the buyer and the seller, is ensuring a successful car insurance transfer to the new owner. But sadly, most people have...

    read more
  • 9 Secrets That Your Motor Insurance Provider Won’t Tell You

    9 Secrets That Your Motor Insurance Provider Won’t Tell You Due to the dangerous driving conditions, it is compulsory to have third party insurance for every vehicle plying on Indian roads. It ensures the overall saf...

    read more
  • Money Saving Advice for All Car Owners

    Money Saving Advice for All Car Owners After a dream home, a dream car is your second-largest purchase that you make in your lifetime. But the expense does not cease when you drive off the car dealer's lot. Read mor...

    read more
  • Difference Between Comprehensive Insurance and Third Party Insurance

    Difference Between Comprehensive Insurance and Third Party Insurance Comprehensive insurance is insurance coverage that pays for the repair or replacement of vehicle damages resulting from an incident. Comprehensive ca...

    read more
  • Types of Motor Insurance

    Types of Motor Insurance The word Motor broadly covers a lot of classes of vehicles plying on the roads. These may be two-wheelers like scooters and motorbikes, three-wheelers or four wheelers like private cars, jeeps, ...

    read more

Find similar car insurance quotes by body type

Hatchback Sedan SUV MUV
insurance-ka-superhero
Search
Car insurance save up to 85
Disclaimer: Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.
Calculate your car IDV
IDV of your vehicle
Calculate IDV
Calculate Again

Note: This is your car’s recommended IDV as per IRDAI’s depreciation guidelines.asdfsad However, insurance companies allow you to modify this IDV within a certain range (this range varies from insurer to insurer). Higher the IDV, higher the premium you pay.

Policybazaar lets you compare premium prices from 20+ Insurers!
Compare Prices

Why buy from Policybazaar?

  • 24x7 Claims Assistance
    NEW
  • Cashless Assurance
  • 3-Day Repair Assurance
  • Free Pickup & Drop
  • Self Video Claims
  • Windshield Claims At Home
View Plans

Car insurance articles

Recent Articles
Popular Articles
Is Suspension Covered Under Car Insurance?

29 Jun 2022

A car's suspension helps to maximise the friction between the...
Read more
Know All About Vintage Car Registration Process

28 Jun 2022

No car can beat the beauty of a classic vintage car cruising on...
Read more
How to Save Your Car During Monsoon with Add-On Insurance Covers?

24 Jun 2022

Rains in India are mostly witnessed during the monsoon season. The...
Read more
Know About NCB Certificate in a Car Insurance

21 Jun 2022

With your car insurance policy, you get an additional benefit of a...
Read more
Know Everything About Endorsements in Car Insurance Policy

20 Jun 2022

When you buy a car insurance policy from an insurer, your policy...
Read more
Getting Your Duplicate Car Insurance Policy is Easy-Here’s How!
Losing important documents, such as your car insurance documents, can be daunting. In such a state of affairs, the...
Read more
Multiple Ways To Check Your Car Insurance Status Online
All insurance companies in India now have a digital presence. It not only makes it easier to buy insurance online...
Read more
Transferring Car Insurance from One Person to Another
An integral part of selling a car, for both the buyer and the seller, is ensuring a successful car insurance...
Read more
Check Car Insurance Status Online on Parivahan Sewa/ RTO?
In India, buying car insurance is a compulsion for every car owner. It doesn’t matter if you are an excellent...
Read more
Car Depreciation Calculator
If you are looking to purchase a new car or planning to sell your existing one, it is important to know how...
Read more