Buying an insurance for your car is a smart decision. It is an annual contract that covers your vehicle from damage and you from a financial loss.
However, car insurance is an annual contract that means it is up for renewal at the end of the financial year. You can choose to continue with your existing insurer or shift to another.
In India, insurance for your car is mandatory by law. Therefore do not forget your car insurance renewal date. While the renewal process is a simple one, there are a few points that you must know.
1. Type of Plan
In India, third-party insurance is mandatory by law. You have to purchase it. However, the other type of insurance—comprehensive insurance plan is your choice. You can opt to purchase it or not.
It is tempting to only purchase third-party insurance and save money but the wise action is to go for the comprehensive insurance. It will cover third party death/injury/damage and covers your car against any damage due to accident.
2. No Claim Bonus (NCB)
NCB is the bonus or reward an insurer gifts you if you have a claim-free year. The reward or gift is discount on the premium you pay for the next financial year. When you are renewing your insurance, remember to factor in NCB if you had a claim-free year.
3. Depreciation Value of The Car
When you are renewing your car insurance, the insurer will review the depreciation value of your car while calculating the insurance premium.
What you should do is be informed of your vehicle’s market value and depreciation value. This information will assist you to bargain with the insurer when it comes to deciding the premium.
When you renew your vehicle’s insurance, the insurer will try their best to sell you various add-ons. They are beneficial when you purchase the ones you need. If the monsoons will hit soon after your insurance renewal date, purchasing an engine protector add-on is the right thing to do.
Always buy add-ons you need. It will save you money and headaches.
5. Compare Online
Each time you renew your vehicle insurance, it is your duty to find the best benefits for yourself. Go online and visit aggregator sites, check out their details and user experience on insurance renewal. Now you can make a choice on whether to stick with your insurer or shift to another insurer.
These five points are simple and helpful when you renew your vehicle insurance. Remember, car insurance renewal is as important as buying a new one.