All You Need to Know About CNG Car Insurance

CNG car insurance refers to a motor insurance policy that covers the Compressed Natural Gas (CNG) kit installed in your car. Similar to a standard car policy, it financially protects you against accidents, theft, fire, natural disasters, and third-party liabilities. However, it also covers specific risks associated with owning a CNG car. If you are planning to install a CNG kit in your car or buy a new CNG car, you should know how it will affect your insurance costs. Here is everything you need to know about CNG car insurance and its impact on your premium.Read more

Factory-Fitted CNG Cars vs Externally Installed CNG Kits

Have a look at the table below to understand the major differences between a factory-fitted CNG car and an externally installed CNG kit in terms of car insurance:

Is a CNG Kit Covered Under Car Insurance?

You can cover your externally installed CNG kit under comprehensive car insurance. It will cover you against insured events as per policy terms and conditions. However, the coverage will apply only when you declare this modification to your insurer and get it recorded in your policy.

What is a CNG Endorsement in Car Insurance?

A CNG endorsement in car insurance means updating the policy after installing the CNG or bi-fuel kit and modifying the insured vehicle specifications accordingly. This endorsement confirms that the insurer has acknowledged the presence of the CNG kit in the insured car and included its coverage in your policy records.

It helps reduce the chances of any claim-related disputes that may arise from any undeclared modifications. You may need to pay an additional premium depending on the value of the CNG kit and the insurer's terms.

How to Add a CNG/Bi-Fuel Kit to Your Car Insurance?

After you install an external CNG kit in your car, follow this simple process to update the relevant records in your car insurance:

1. Step 1: Update your Car's RC (Registration Certificate)

   Immediately after the installation, inform the Regional Transport Office (RTO) and get your car's RC updated to reflect the CNG details.

2. Step 2: Notify Your Insurer

   Inform your car insurance company about the CNG kit installation and make a request for updating the policy records.

3. Step 3: Provide Documents

   Submit the necessary documents, such as the CNG installation certificate and your updated vehicle RC, to your insurer.

4. Step 4: Pay the Additional Premium

   The insurer may revise your car insurance premium based on the value of the installed bi-fuel kit, which you need to pay to update the policy.

5. Step 5: Get the Policy Endorsement

   After updating the records, your insurer will issue a car insurance endorsement certificate that will reflect the modified car details.

You May Also Read: Things to Know Before Installing a CNG Kit in Your Car

How Does a CNG Kit Affect Car Insurance Premium?

Adding a CNG kit slightly increases your car insurance premium. This is because the insurer extends coverage to the additional components installed. The value of the CNG kit is added to your car's IDV, and insurers charge an additional premium to cover its repair or replacement costs in case of any damage or loss.

The exact premium increase depends on the following factors:

• Value of the CNG Kit: The cost of the installed bi-fuel kit is one of the primary factors that insurers consider when calculating the revised policy premium.
• Car Make & Model: Premium calculations may vary based on the vehicle's specifications and market value.
• Registration Location: CNG car insurance prices may also vary depending on the city where your car is registered.
• Policy Type: A comprehensive policy provides broader coverage than third-party insurance and has a higher premium.
• Add-On Covers: If you also opt for add-ons with your policy, they may increase the final premium price.

Using CNG Car Insurance Premium Calculator

If you are looking to purchase CNG car insurance, you must calculate the premium that you will be required to pay beforehand. You can do so online with the help of a car insurance premium calculator. On the calculator page, simply enter your vehicle details, such as its make, model, variant, RTO, registration year, etc., and it will determine the estimated insurance premium you need to pay for your CNG car.

Can a Car Insurance Claim be Rejected for an Undeclared CNG Kit?

Yes, your car insurance claim can be rejected if you have installed a CNG or bi-fuel kit without updating the relevant car specifications and insurance details. Car insurance companies treat an undeclared CNG kit as an unreported car modification, and they may examine the discrepancy when settling a claim.

This means claim delays, disputes, or partial settlements, depending on the circumstances. Have a look at the different scenarios due to which issues can arise:

• The modification was not disclosed
• The Registration Certificate was not updated
• The policy endorsement was not obtained
• The kit was installed through an unauthorised source

Tip: To minimise claim issues, keep both car and insurance records updated once you install a CNG kit.