Steps to Follow While Buying Car Insurance

Troubles come uninformed, therefore, even an experienced driver cannot avoid the risk factor while driving.  Even a minor accident or a slight bump can result in heavy repair costs. The only way to be prepared against such circumstances and losses is to buy a car insurance policy. Car insurance covers you against losses that you might incur due to theft of your car or damage due to accidents or even natural calamities. Each month you pay a certain amount of money to the insurance company and you get an assured sum when in need.

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When you buy a car, buying auto insurance is  mandatory.  Buying a car insurance plan can be tricky if you are unable to choose the right cover and the right insurer. To help you find the right plan, we have outlined the steps that you ought to follow

1. Understand and Assess

Before you buy insurance for your car, it is essential to understand the two major categories of motor insurance, namely, third-party liability and comprehensive insurance. The next step is to wisely analyze and decide the amount of cover you would require.

While deciding the coverage you need for your car, make sure you're covered for an amount equal to the total value of your car. You should also keep in mind the minimum level of cover that is set as mandatory by your state government. While it is unsafe to be underinsured, paying unnecessarily high premiums can also be heavy on the pocket. 

2. Compare and Choose

It is wise to compare the quotes before buying car insurance as it can save you a hefty amount of money and provide better coverage options as well. Also, the comparison platforms allow you to do a detailed comparison between insurance companies on the basis of their financial track record and claim settlement ratio. You can also run a survey by asking the existing customers of the insurance companies. Comparing car insurance policies at Policybazaar Insurance Brokers Private Limited (formerly known as Policybazaar Insurance Web Aggregator Private Limited), can save you up to 55%* of the premium amount. For instance, for petrol variant of Maruti Swift registered in North Delhi; the annual premium is nearly Rs. 7,884.

* All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C apply.

3. Look for Discounts

You need to be constantly on the lookout for discounts which can substantially reduce the burden on your pocket. Such factors as good driving record, gear lock, anti-theft system, safety equipments can reduce your annual car insurance premium by up to 5%.

Since these factors ensure enhanced safety of your car, it reduces the cost of the insurer and the benefit is carried forward to the consumer. So, make sure you explore all the available options and minor details about your car while buying car insurance. For instance, air bags and anti-lock brakes help in keeping you safe and your insurance bill low.

 4. Add-ons

Add-ons make it possible to customize your car insurance as per your need, besides adding on to the protection.  Nowadays, insurers provide you with tailored recommendations for add-ons that specifically suit to your needs based on such details as the age of your vehicle, its model and several other factors.

You should invest small amounts of money for additional benefits such as nil-depreciation insurance, roadside assistance and personnel cover. Add-ons might increase your premium but they provide extra protection to both you and your car.

5. Never Undervalue

The premiums of your car insurance are decided on the basis of Insured Declared Value or IDV of your vehicle. Your agent might decrease the IDV of your vehicle so that your premiums are low. This is not advisable because undervaluing your car can create issues while claiming the right amount of the loss incurred.

In case of an accident, your car might be treated as a complete write off. A high IDV means a higher premium, and low IDV means a low premium. But, one should certainly avoid the practice of reducing the IDV (Insured Declared Value) of your car to save on premiums.

Read more about: How to Find the Right Car Insurance According to your needs

ADVISORY NOTE: Accident-prone drivers may be required to pay higher premiums. Therefore, to keep your premium low, drive safe and file claims only when necessary.  

Written By: PolicyBazaar - Updated: 26 June 2021
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