All About Anti-Theft Device and Its Impact on Car Insurance

The number of car thefts in the country has been on a steady rise. Take for instance, the capital of India, Delhi. The city has recorded a 38% increase in motor vehicle thefts. Simply put, every day, 84 vehicles are stolen in the city. Consequently, protecting your vehicle from being stolen becomes all the more important.

One of the safest ways to do this is to install an anti-theft device approved by ARAI (Automobile Research Association of India) . The installation of an anti-theft device not only enhances the security of your vehicle, it also lowers your insurance premium. Let’s go in details to understand how anti-theft device impacts your car insurance.

Why do car insurers offer discounts to cars fitted with anti-theft devices?

Insurance companies consider those car owners responsible who have anti-theft device installed in their vehicles. It is believed that the number of stolen cars is bound to drop due to the installation of this device and it is in favor of car insurers as there are fewer cases of claim. Hence, insurers encourage car owners to install anti-theft devices in their vehicle by offering lucrative discounts on insurance premiums.

How much benefit can you get?

Usually, car insurers give a 2.5% discount on the premium to a maximum of Rs 500 if the vehicle is fitted with an anti-theft device. However, the discount is available only for the damage caused to your vehicle during an accident and does not include the premium of the third-party cover. (Refer to the below table).

Name of the Insurer Premium (in Rs.) Premium after anti-theft discount (in Rs.)
Reliance General 18242 17834
Tata AIG 12241 11984
Universal Sompo 7483 7175
Future Generali 8194 7568

*The above calculation is done for Maruti Swift Dzire Vxi, 2015 Registered, Petrol Variant and North Delhi Registration.

Do new cars come fitted with anti-theft devices?

Nowadays, many cars come fitted with anti-theft devices. Most luxury car manufacturers such as Toyota, Ford Motors and Mahindra have an inbuilt anti-theft system in their high-end models. Even mid-segment players such as Maruti Suzuki have introduced anti-theft devices in many car models. Insurers want to make anti-theft devices mandatory in two-wheelers and commercial vehicles also as it would help reduce the cost of honoring motor vehicle insurance claims.

What type of anti-theft device should you install?

Numerous car security options are available in the market, such as mechanical device and ignition cut off device, intelligent computerized anti-theft, satellite tracking system and engine control module. You can choose a device depending on your requirements and the risks you are exposed to.

Note that irrespective of the anti-theft device you choose, it must be approved from the Automobile Research Association of India (ARAI). Some of the approved anti-theft brands by ARAI in India are AutoCop, Minda, Nippon and Xenos.

You should install a good anti-theft device in your car if the area you stay or drive-in is unsafe and theft-prone. These safety devices come in different variants. Before picking one for yourself, consider which features are useful for you:-

  • Alarm:- In the case of vehicle tampering, audible warning sounds emerge
  • Keyless lock device:- To use the vehicle, electronic coding device is required
  • Electronic Immobilizers:- These built-in transponders send signals to the ignition and fuel pump system. The vehicle remains in an inoperable state if the ignition starters do not get correct signals.
  • Steering wheel lock:- This device goes over the steering of the vehicle and locks it in one place so that no one can drive it without removing the lock.
  • Vehicle tracking:- Even if a thief steals your vehicle, tracking technologies can help trace it. Tracking devices offer real-time location of the stolen vehicle with the help of the global positioning system (GPS).

Read Also-: 2 Scenarios When Not To Claim Car Insurance

Is any discount available if is the device is installed in the middle of the policy term?

If you install the safety device after you have bought the policy, the insurer will calculate the discount on a pro-rata basis for the remaining policy tenure as per tariff provision.

What is the cost of anti-theft devices?

The cost of anti-theft devices depends on how technology-enabled they are. A basic alarm device will cost you between Rs 3,000 and Rs 4,000, whereas, for a GPS or Intelligent Computerized Anti-Theft (ICAT) system, you will have to spend between Rs 6000 and Rs 17,000.  

Written By: PolicyBazaar - Updated: 25 May 2020
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