These measures can help you save on your car insurance premium.
Motor insurance costs roughly 3-4% of the price of the vehicle in the first year. If no claim is made, it will progressively come down to about 1-2% by the fifth year. There are many ways to reduce this cost. For instance, experts advise against filing a claim for minor dents and scratches. It is more cost effective to get minor repairs done on your own than file a claim and lose the no-claim bonus. Here are a few other ways to bring down your car insurance premium.
TRANSFER NO-CLAIM BONUS
You can save big by transferring the no-claim bonus from your old vehicle to the new car. Agents don’t tell you this because it hits their business. When you sell your old car, retain the insurance in your name. Take the no-claim certificate from the insurer and reserve the bonus if you are not buying a new car immediately. The accumulated no-claim bonus has to be transferred to the new vehicle within three years of the sale.If you have not made any claim for the past 4-5 years, the premium of the new car will come down by 50%.
OPT FOR A HIGHER DEDUCTIBLE
One way to reduce the insurance premium is by increasing the deductible component.This is the amount you are ready to pay from your own pocket when you make a claim. So, if you opt for a `5,000 deductible and the repair bill comes to `8,000, you will have to pay the initial `5,000 while the insurance company will pay only `3,000. Use this option very prudently.If you opt for a very high deductible only to reduce the premium, you will end up paying too much for repairs.
INSTAL ANTI-THEFT DEVICES
If you instal anti-theft devices in your car (such as a gear lock or a steering lock), the insurance company gives you a small discount of up to `200 or so. But these safety devices should be from authorised manufacturers. If you become a member of certain automobile organisations, there’s another small discount offered on the premium.
Source: Economic Times
Date: 26th September 2016