8 Factors Influencing Car Insurance Premium for SUVs and Sedans

The range of cars offered by the automobile sector in India has improved over the years. From luxurious sedans to subcompact SUVs, you can purchase a car as per your requirements and budget. However, when it comes to purchasing a motor insurance policy for SUVs and sedans, there are some necessary factors that you need to consider. Read on to know about these factors.

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8 Factors Affecting Motor Insurance Premium for SUVs and Sedans

Whether you buy a modern in-trendy SUV or a classic sedan, car insurance is a mandatory requirement that you need to drive in India. However, before purchasing one, you need to consider certain factors that can influence the premium of your four-wheeler insurance policy. Below we have explained 8 such factors that influence the motor insurance premium for SUVs and sedans.

1.Type of Car Model

The model of your four-wheeler largely influences the premium of your motor insurance policy. If you are planning to purchase a luxurious and expensive sedan model, the IDV of your car will be higher and so will be the insurance premium. However, if you are looking to purchase a compact and economical car like an SUV, the IDV of your car will be lesser, thus, resulting in a lower motor insurance premium.

2.Age of the Car

The age of your SUV or sedan is also taken into consideration while calculating the car insurance premium. This is because the depreciation value and wear & tear of the vehicle increase as it ages, thus, reducing the market value of the car. Thus, the rate of premium for older cars will be lower due to a lesser market value. On the other hand, the wear and tear in a brand new car will be lesser resulting in a higher market value and therefore, a higher four-wheeler insurance premium.

3.Type of Engine

The engine type also influences car insurance premiums for SUVs and sedans. Cars that run on petrol are mostly less expensive than diesel ones. Thus, SUVs and sedans having a petrol engine have less insurance premium than diesel ones. Similarly, a car running on CNG or LPG kit is expensive, thus, its car insurance premium is higher. Moreover, if you install a CNG or LPG kit separately in your SUV or sedan, your motor insurance cost will rise.

4.Engine Capacity

The engine capacity in CC is also an important factor that impacts your car insurance price. The higher the CC of the engine, the higher will be the motor insurance premium. Since SUVs and sedans have a higher engine CC as compared to hatchback cars, their insurance premiums are also higher.

5.Coverage Offered

The premium for sedans and SUVs is also based on the type of car insurance coverage that you opt for. Car insurance is mostly available as a third party liability and comprehensive car policy. The third party liability covers the third party injuries and damages only whereas the comprehensive car insurance policy covers for third-party liabilities and own damages as well.

 Since a third party liability is less extensive, its premium will be less. On the other hand, a comprehensive car policy offers a wider coverage and thus, its premium is higher as compared to a liability-only policy. Moreover, if you opt for add-on covers under your comprehensive motor insurance policy, your premiums will increase.

6.Location of the Car

The location where your four-wheeler was purchased also influences car insurance premiums for SUVs and Sedans. If your car was purchased to drive in an urban area or big city where there are more chances of an accident, the car insurance price will be higher. On the other hand, if you intend to drive a car in a small town where there is less number of vehicles, your car insurance premium may reduce.

7.Car Modifications

Any modification done to your SUV or sedan also affects the insurance premium of your car. Modifications are done to alter the appearance of the car or enhance its performance, which increases the value of your car, thus, leading to an increase in the car insurance price. For instance, if you have modified the car’s engine to increase its speed, it will increase the chances of an accident, thus, increasing the premium of your motor insurance policy. Similarly, if the exteriors of the car have been changed to make it look more appealing, it will impact the insurance premium of your SUV or sedan.

8.Insured Declared Value (IDV)

The Insured Declared Value or IDV is the maximum value of the car that an insurer will pay at the time of a total loss or theft of the car. This amount also influences the premium of motor insurance for SUVs and sedans. The higher is the Insured Declared Value of your car, the more insurance premium you will be required to pay. Similarly, if the IDV of your car is low, it will reduce the car insurance premium of your four-wheeler.

Some other factors that may impact the motor insurance premium of an SUV or sedan can be the driver’s driving history, claim history, and driver’s age.

Final Thoughts

Whether you are looking to buy an SUV or a sedan car, the motor insurance premium for both types of vehicles will be impacted by the above-mentioned factors. Thus, before selecting an SUV or sedan, make sure to consider these factors to get a fair estimation of the motor insurance premium that you will be required to pay. Furthermore, you can also compare four-wheeler insurance premiums for SUVs and sedans from websites like Policybazaar.com and choose the right coverage for your car.

Written By: PolicyBazaar - Updated: 01 April 2022
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