When you’re trying to get a good rate and good coverage with your car insurance plan, then you need to do your research before you make any decisions. Yes, research is required to get a good deal, and it’s crucial in getting a good price for your car insurance policy.
Why Do You Need A Car Insurance
You love and adore your car. It’s your best buddy on the road. So why go wrong when choosing an insurance plan? It is crucial to buy a car insurance plan that best suits your requirements and offers adequate protection to the car.
Did you know?
In India, as per the Motor Vehicles Act, it is mandatory for every vehicle owner to possess a valid Insurance to be able to drive on road?
Yes, you heard it right. Any vehicle used for pleasure, business, household or social purpose needs to be insured. Violation of the Motor Vehicles Act is punishable with a fine or some specific term in the prison.
So what does your car insurance cover?
All vehicles are insured at a fixed value referred to as the ‘Insured’s Declared Value’ or IDV. The IDV is calculated in the following way:
The selling price of a vehicle described by the manufacturer
Price listed for accessories
Depreciation for each year according to the schedule provided by the Indian Motor Tariff
Manufacturer’s Selling Price + Price for Accessories – Depreciation = IDV
In case, the manufacturer’s price does not include an electrical and/or electronic item installed inside the car, then the actual value (after depreciation) of the specific item(s) can be added to the sum insured over and above the IDV.
If the vehicle is installed with any of the RTO permitted bi-fuel system, the fuel kit must be insured separately. This will add 4 percent to the premium. You should mention this in the proposal form:
What to take into account when buying car insurance?
The Requirement by Law
As already discussed, you need to consider the Indian motor vehicle regulations before buying a car insurance plan. Keep the specific requirements in mind before making a purchase.
Did you know?
There is a Mandatory ‘Limited Liability’ requirement that you must buy? You can definitely buy a higher cover to ensure maximum returns. However, keeping the minimum requirement in mind is the best way to abide by the law.
Make sure you install an anti-theft device to your vehicle. The device should be approved by the ARAI (Automobile Research Association of India). This may help you clear a small discount on the premium.
There’s no better way of buying car insurance than getting one online. You can gather info about various plans and their cover facilities when buying a plan online. Browsing through this info will help you get acquainted with various benefits, cover facilities, exclusions, claims formalities and much more.
Make sure you renew your insurance plans on time. This is extremely important. Policy lapse may keep you from enjoying many benefits. So keep updating yourself about the policy expiration date and renew within the permissible period.
Try to Get A Fair Deal
Many people will actually just select the first policy that they get a quote for, and this isn’t a good way to get a fair deal. It’s all about comparisons, so doing your “homework” about insurance rates through comparison can save you hundreds of dollars a year.
Many people use the excuse that they don’t have time to research these insurance quotes and look critically at the information in a way that can save them money. It actually takes only a minimal amount of time to do the research to get many of these insurance quotes.
How can this be done quickly and efficiently?
It can be done in the easiest form on the Internet! Many online Internet sites offer you the opportunity to compare car insurance quotes, and all you have to do is fill in demographic information and information about the make, model and history of your vehicle.
This pre-research can even come in handy when you’re going to buy a car, as car insurance premiums can be increased depending on the kind of car you drive, and picking a safe and reliable car can save you a lot of money.
So what’s the ideal number when you’re looking for information and insurance quotes for your car insurance policy?
You should make it your goal to speak with at least five car insurance companies to get a highly objective list of car insurance quotes that will allow you to make a far more informed decision.
Depending on the region where you live in, this can limit which car insurance companies you can form a business relationship with, so save yourself some time by making sure that you’re following up about a quote with an insurance company that you can actually be insured under.
This region you live in can lower or raise the car insurance premium, and this is something that you’ll want to know right away.
Don’t be afraid to be unconventional when reaching out to get insurance policy quotes for yourself, as this sometimes actually yields excellent results. If you’re not finding prices and quote that you can live with online, and then why not try other communication media to reach out?
Calling insurance companies on the phone can lead to an excellent conversation with a knowledgeable insurance agent who can guide you in the correct direction, and can also get you a decent rate or a rate discount.
If you see an online quote that you’re not sure about its actual correctness, then why not also use the phone to reach out and follow up about this quote?
It can actually work in your favor in some cases and can get you a lower rate or more coverage than you had originally anticipated, depending on your specific driver circumstances.
Do You Qualify for these BIG Auto Insurance Discounts?
Auto insurance often takes a big bite out of your paycheck. In some ways, it’s unavoidable because most states require you to have auto insurance as a condition of driving, and you can even lose your license if you don’t carry insurance.
But most insurance companies offer hidden discounts — big savings that most customers don’t know about. Ask yourself if you qualify for any of these common discounts, and if you do, make sure to ask your auto insurance representative about them.
Do You Own More Than One Vehicle?
If you own more than one vehicle, insure them all through the same insurance company. Many companies let you save money on auto insurance when you insure multiple vehicles. Even if you don’t own more than one vehicle yourself, if other members of your household own vehicles, you can take advantage of this discount.
For example, if your spouse or child owns a vehicle, you can still get a multi-vehicle discount if you insure all these vehicles through the same insurance company.
Similarly, if you purchase different types of insurance from the same company, you may qualify for a discount. For example, if you purchase homeowners insurance or renters insurance from the same company that you purchase auto insurance from, you may qualify for multiple insurance discounts.
Is Your Driving Record Clean?
Insurance companies offer “good driver discounts” for drivers that haven’t had an accident or ticket in a certain number of years. Most companies require you to have a clean record for three years, although the exact time frame varies by the insurance company.
If you haven’t had any accidents or tickets in several years, make sure to let your insurance company know so you can take advantage of this discount.
Are Your Teen Drivers Good Students?
When your kids get old enough to drive, it often causes your insurance rates to skyrocket because young drivers tend to be involved in more accidents than older drivers.
If your teenaged drivers get good grades, however, you might be able to offset the additional premiums because they’ll qualify for a “good student discount.”
Insurance companies offer significant savings to drivers who make at least a B average every semester. You may have to submit your kids’ report cards to your insurance company to take advantage of this discount.
Have You Taken Defensive Driving?
If you take a defensive driving class, your insurance company may conclude that you’re less likely to get in an accident. Thus, many insurance companies offer savings to drivers who complete such courses. You may have to take classes from a school approved by the insurance company, so check with your insurance representative before you enroll in such a class.
What’s Your Job?
Insurance companies including Costco offer discounts to members of certain professions. It’s common to offer discounts to military members and to teachers. Bring proof of your occupation to your insurance representative to take advantage of this type of discount.
5 Ways Credit Rating Can Affect Your Auto Insurance Rates
Insurance companies review their customers’ credit rating just like banks or other creditors do in order to determine how much of a risk they are taking on by offering you an insurance policy. A low credit score can affect your insurance policy in several different ways.
1. Higher Down Payments
While many auto insurance companies offer monthly payments for the customers, you may not be given the option for low monthly payments if your credit score isn’t up to par. Insurance companies see individuals with lower credit scores as higher risks, just like banks do.
If you auto insurance provider thinks you’re less likely to make your monthly payments on time they might require that you pay for your entire policy up front to save themselves from possibly sending out late payment reminders and cancellations for non-payment.
2. Say Good-bye to Preferred Status
Many insurance companies have a number of subsidiaries that they write insurance through. They might have one company with all of their preferred customers, one for there standard customers and one for higher risks.
If your credit score is low be prepared to find yourself in the higher risk category and pay more for insurance while being locked out of additional benefits that preferred customers might receive, like accident forgiveness.
Insurance companies pull credit scores for existing customers on a regular basis just like they do for new customers. If your credit score takes a dip you might face a notice that your insurance company will not continue to cover you past your current policy period. If you receive a letter stating your company will no longer cover you be prepared to shop around for a new insurer.
Looking for a new insurance company is often more difficult for customers that have a low credit score. If an insurance provider thinks you are too high a risk for their taste they might make you pay more for insurance, or they may refuse to offer insurance to you at all.
If an insurer denies you coverage keeps looking until you find a company that will give you affordable coverage and works on increasing your credit score so your insurance rates will benefit.
5. Higher Deductibles
Because customers with low credit scores are considered at a higher risk for making claims on insurance, your insurance company may not offer you the option of carrying low deductibles.
Even if your auto insurance provider has $100 deductibles available for some of their customers you might find yourself resigned to $500 deductibles or higher.
The good news is it will help keep your rate a little lower. The bad news is you will have to pay more out of pocket if you make an insurance claim.
Work on improving your credit rating you find yourself facing one or more of these situations because of a low credit score. Making payments on time, paying down credit card balances and paying off loans are all ways you might be able to improve your credit score.
3 Tips To Avoid Surprises With Car Insurance Claim
A car can mean so much more than what it appears to be on the surface. It is your link to family, friends, and work, and for many people, an expression of their livelihood and passion.
Therefore, it is important to ensure that in the event of a claim arising, you are covered for both the financial and emotional value of your vehicle. Follow these tips from industry insiders to avoid any surprises when it comes to making a claim on your car insurance policy.
1. Understand the difference between market and agreed values
Many cars these days do not hold their value like they used to. Cars depreciate very quickly following a purchase, and six months down the track you may find that your car is worth much less than what you paid for it.
For example, a vehicle purchased for $10,000 in January may only be worth $7,000 in June the same year. The $3,000 difference between these two values is called depreciation and can be a nasty surprise at the time of making a car insurance claim.
When you insure your vehicle for its market value, you will only be paid out what the vehicle is worth at the time of making a claim.
Conversely, insuring a vehicle for an agreed value allows the insured to nominate a figure (usually the price paid for the vehicle) that ensures a loss will not be made in the event of a claim. This will usually result in an increased premium but will also result in peace of mind.
So, using the example above, a claim made for a vehicle insured for its market value will only result in a $7,000 payout if the claim was made in June, whereas a claim made on an agreed value policy will result in a $10,000 payout regardless of when the claim is made.
2. Ensure that windscreens are covered under your policy
Replacing a windscreen can be very costly for those without insurance. Many ‘comprehensive’ car insurance policies, however, do not cover windscreens by default, and it is important to ensure that yours does.
Most insurance companies offer windscreen cover as an add-on at a slightly increased cost, so check with your insurer to see if this is possible.
3. Ensure that valuables are covered under your policy
Sunglasses, jewelry, laptop computers, and GPS units are commonly transported in cars on a daily basis. However, many insurance companies do not cover valuables stolen from a car by default.
In many cases, customers are required to actively opt into valuables cover, usually at an increased cost. Contact your insurance company to ensure that the full value of whatever a thief may steal from your car will be paid out in the event of a claim.
Ultimately, it is important to thoroughly read an insurance policy’s product disclosure statement before making your first payment. It is also important to ensure that the price you are paying for your premiums is cost-effective but also meets your needs.
Five Reasons to Get Temporary Car Insurance
Many people don’t realize that temporary car insurance exists, let alone understand how important this type of insurance can be. Whether you own your own car or not, situations will arise when you need auto insurance for only a short period of time.
While these policies used to require a six-month contract, consumers today can purchase car insurance for a period as short as a single day. Here are five common reasons consumers purchase temporary insurance policies:
If you’re going on vacation, you may find that renting a car makes more sense than walking or hailing a taxi. If your primary auto insurance doesn’t provide coverage that extends to a rental, adding a short-term rider to your policy makes sound financial sense.
Rather than purchasing expensive insurance policies from the rental agency, or paying yearly premiums for coverage that you only need once a year, paying for a temporary policy is often a more budget-friendly alternative.
2. House Guests
If you are the sole owner and driver of your vehicle, you may not have coverage that adequately protects alternate drivers. If you’ll be welcoming out-of-town visitors into your home, you may not want to act as a chauffeur for their entire stay.
Just as you won’t feel like driving your guests everywhere they want to go, they won’t feel like sitting in the house for their entire trip. Taking out a temporary insurance policy will allow you to safely allow your house guests to borrow your car.
3. Temporary Control
If you have temporary control over a vehicle, for whatever reason, you won’t want to pay high, bi-yearly premiums to ensure that both you and the vehicle are protected while you drive.
For instance, if your vehicle is rendered unusable, and you have to borrow someone’s car until yours is fixed, a short-term insurance policy can provide the protection that both you and the vehicle’s owner are looking for.
4. Quick Sales
“Flipping” is a popular American past-time, as is evident by the many television shows on the subject. If you buy vehicles, restore and then sell them, it doesn’t make sense to purchase extended insurance coverage on every car that you purchase.
Temporary auto insurance can make sure that you and others on the road are protected for as long as you choose to drive the car you are going to sell.
5. School Breaks
Many colleges place restrictions on which students are permitted to bring their vehicles to campus. For instance, some schools allow only upperclassmen to park a car on school grounds.
If you have a college student in the family who has to leave their car behind, it doesn’t make sense to keep the car fully insured while it is sitting in your driveway. Instead, you can purchase a temporary insurance policy for your child when they are home for spring, summer and winter break.
If you’ve never heard of temporary car insurance, it’s time to speak with your agent. There are many situations where it makes better financial sense to utilize these temporary policies rather than typical ones.
If you will be renting a car, borrowing someone else’s car or letting someone borrow yours, a temporary auto insurance policy can provide the protection that you need without the high cost and required renewal of a standard policy.
Do I Need Car Insurance If I Am a No-claims Driver?
Car insurance is a complicated and technical issue that most people call the necessary evil. In most cases, drivers and the general public are given false information and myths regarding what one should or shouldn’t do when it comes to car insurance.
Though this situation of ignorance is becoming less common in this age where information is readily available through various mediums where anyone can educate themselves about anything just by the click of a mouse, it is still important to breakdown all insurance information into manageable and understandable bits and pieces.
Car insurance is a legal requirement in many countries around the world. This kind of insurance is not only for motor or passenger vehicles but also applicable to trucks, motorcycles, buses, and even vans.
Car insurance is structured to protect people involved in accidents whether they are at fault or not. An accident is normally unfortunate and hardly ever predictable but in most instances a very devastating experience.
Apart from the trauma of the accident, it is advisable to consult with an expert when you have to live through the crisis. Thus in most cases, car insurance companies have the manpower, personnel, and expertise that is required to deal with such occurrences.
In the world of car insurance, there are numerous myths some claiming that if one doesn’t have the tendency of having accidents then they usually don’t have any use of a car insurance policy.
Basically, a no claim driver is a driver that generally does not make claims against their insurance policy. Such drivers rarely have a reason to as they are generally excellent and very careful drivers. In most cases, if such a driver has a car insurance policy they are usually awarded a no claims’ discount.
A no claims’ discount is a price cut awarded to such a driver which essentially reduces the rates that the driver pays out to the insurance company.
Although being a no claims’ driver is a clear indication that one is a great driver, it still doesn’t mean that they are exempt from the car insurance law.
This is because there are many road users, some good others not and although one may actually be an excellent driver it doesn’t mean that another driver won’t hit them and in such cases, they would need a car insurance policy and the services of an insurance company to deal with the problem.
Car insurance also helps one to avoid long debates and discussions when it comes to knowing who is at fault or who should pay for the damage and medical bills. Apart from being the legal thing to do, a car insurance policy in most cases proves to be worth the trouble and cost of maintaining it.
Besides when one is a no claims driver they tend to pay much less in terms of insurance rates, thus making the car insurance policy a much cheaper and easier to handle the undertaking.
College Car Insurance: Getting The Best Rate for Your Kid
If you have a child that is in college or is soon to be in college, you really need to start considering how you are going to insure them. College students are some of the most expensive people to insure, but there are several steps and methods you can take to make sure you’re getting the best rate possible.
The first thing to consider is where your child is actually going to school. If they’re attending a school that’s in an urban center, you’re probably going to have to bite the bullet and pay a little bit more for car insurance. The reason for this is because most accidents tend to happen in city centers – there’s simply more traffic, pedestrians, and opportunities for accidents to arise.
For out-of-state college students, be sure that you actually take a look at the requirements for car insurance in that state as well as your own. The last thing you want to happen is for an accident to occur while your child is at school. Then you would have to cover the entire amount because your insurance did not meet the requirements. It’s a very simple check and it will save you hundreds, if not thousands of dollars.
Next, it is just a fact of life that most college students will be under 25. This means that they’re in a predetermined riskier class of drivers and you will not be allowed to do anything about this adjustment to the insurance rate. However, once your child gets their undergraduate degree and pursues higher education, it might be more affordable at that time because they will have passed the 25-year-old range.
You’re probably thinking, “There aren’t a lot of tactics here for actually lowering car insurance for college students!” That’s what’s coming up next. There are three simple tips you can use to get better rates for your college-bound children.
Many colleges have robust transportation systems. Your child might not even have to bring a car to college if they’re going to school with one of these systems in place. That means that you have to pay a base rate that is much cheaper than the rate you would pay if they were to actually take their car to school.
Encouraging academic progress is another way to get discounts on car insurance. Often times if you have higher than a 3.0 you can get a good driver discount that saves you around 10%.
Sending your child off to school with a safe vehicle will reduce their insurance bill. It might be a good decision because they are more likely to get an accident while in college, so why not put them in a safer vehicle?
These are just some tips to help prepare you to send your child off to school with the proper car insurance. It can be a hard thing letting them go, but making sure you let them go knowing that you have protected them in the case of an accident is one of the most responsible things a parent can do.
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