Car insurance is an important purchase for any vehicle owner. Not only driving without car insurance is illegal in India, but it also provides financial protection in the event of an accident or other incident. However, car insurance can also be quite expensive, especially for those on a budget. 

In this article, we will discuss 10 big ideas for saving on your car insurance. From increasing your deductible to taking a defensive driving course, these tips can help you find the budget car insurance coverage for your needs. But first, let’s get the car insurance basics clear.

What is car insurance and how does it work?

In simple words, car insurance is an agreement between the car owner and the insurance provider where the insurance company agrees to provide coverage for the loss or damage caused to the car in return for the premiums paid by the car owner. In India, it is mandatory to have car insurance no matter whether you own a commercial or public vehicle.

How many different types of car insurance plans are there?

There are five major types of car insurance plans available in India. They are

• Third party car insurance:

As per the motor vehicle act of India, third-party liability coverage is a must-have to drive in the streets of India. It covers the repair/replacement cost of the third-party vehicle, the hospitalization or treatment costs, and the liabilities associated with the death of the third party.

• Collision damage / own damage coverage:

It covers the costs related to the damage to your car caused by a collision. If your vehicle is purchased on a loan, then you must have collision car insurance coverage.

• Personal accident coverage:

This type of car insurance is best suited for those who want to protect themselves. In the event of an accident, this type of coverage reimburses medical expenses.

• Zero depreciation coverage:

This type of coverage is normally offered as an add-on. Let’s say your vehicle is damaged and you need to replace the parts. For claim settlement, the insurer will take into account the depreciated value of the parts. Now if you have zero depreciation coverage, you will get the complete claim amount without any depreciation in the costs. 

• Comprehensive car insurance:

Comprehensive car insurance coverage provides the highest amount of coverage. This insurance coverage includes third-party liability coverage, personal accidental coverage, damage to own vehicle coverage, and non-collision damage coverage such as storms, floods, theft, etc.

What are add-on covers for car insurance?

Add-on coverage benefits in car insurance provide enhanced protection for the insured car. In addition to the coverage benefits included in a basic policy, an add-on cover gives you protection for damages not covered by a standard policy.

How to save money on car insurance?

Fortunately, there are many ways to save on car insurance, from shopping for car insurance with the best rates to taking advantage of discounts. Here are 10 of them.

• Shop around: 

While purchasing car insurance, compare rates from different insurance companies to find the best car insurance plan.

• Bundle your policies: 

Consider bundling your car liability insurance with other policies, such as homeowners’ or renters’ insurance, to get a discount.

• Increase your deductible: 

A higher deductible means you’ll pay more out of pocket if you need to file a claim, but it can also lower your monthly car insurance premium.

• Take a defensive driving course: 

Many car insurance companies offer discounts for drivers who complete a defensive driving course.

• Maintain a good driving record: 

A clean driving record can help you qualify for lower rates.

• Be aware of your mileage: 

Low-mileage drivers may be eligible for a discount, so let your insurance company know if you drive less than average.

• Keep your car in a safe place: 

Cars parked in a garage or a well-lit area are less likely to be stolen or damaged, and that can lower your rates.

• Consider usage-based insurance: 

Some insurers offer usage-based insurance, where your rates are determined by how much you drive.

• Take advantage of discounts: 

Many car insurance companies in India offer discounts for things like good grades, multiple cars, and safety features.

• Consider a pay-as-you-drive plan: 

These plans charge you based on the number of miles you drive, so they can be a good option if you don’t drive much.

In conclusion, there are many ways to save on car insurance, and it’s worth taking the time to explore all of your options. Shopping around for the best car insurance rates, bundling your policies, and taking advantage of discounts can all help you find more affordable coverage. Additionally, maintaining a good driving record, keeping your car in a safe place, and considering usage-based insurance can also lower your rates.

While buying car insurance you can implement these 10 big ideas to make some savings without compromising on the coverage you need. Remember, it’s always good to review your insurance policies periodically and make sure you have the right coverage for your needs, especially if you are buying car insurance for the first time. And also don’t forget to notify your insurance company about any changes in your vehicle or your lifestyle that might affect your coverage.

FAQs:

• How much does car insurance cost?

On average, the monthly car insurance premium cost in India is between Rs.350 to Rs.450. It varies depending on the car insurance type you have chosen.

• How much car insurance do I need?

If you want to drive in the streets of India you need to have third-party insurance, it’s the bare minimum. However, you choose different add-ons or buy premium car insurance policies with higher coverage according to your needs.

• What does full coverage car insurance cover?

Full coverage car insurance is a combination of comprehensive coverage, liability coverage, and collision convergence. It provides both liability and physical damage coverage.

• What is a deductible in car insurance?

The car insurance deductible is the amount you must pay before the insurer will cover the rest of your claim. For instance, if you have filed a claim for Rs.20,000 and the deductible is Rs.1000 then the insurance company will pay 19,000 and you have to pay the rest of the amount.

• What does car insurance cover?

Car insurance protects the owner against liability for personal injury or death caused by an accident or any damage to property caused by an accident. As long as the vehicles are not being used and are parked in a garage, it will also cover fire and theft.

• What is the cheapest place to get car insurance?

It is very difficult to answer such questions, there are several different types of insurance policies available in the market and you have to compare them to get the best car insurance for you at the best possible price.

Disclaimer: I am not a certified financial adviser and this is not financial advice. The purpose of this article is to inform you about financial products and strategies. Consult your financial advisor before making any financial decisions.