How To Reduce The Cost Of Your Motor Insurance Renewal
Investing in vehicle insurance is a smart decision.
It is mandatory to at least have third-party car insurance. By getting your vehicle insured, you are not just being a lawful citizen, you are also saving yourself from possible financial losses. To buy profitable car insurance, you need to invest a sensible amount that includes all the safety measures in the policy. However, there is no harm in looking for ways to reduce your cost while staying constant with the benefits.
Most of the vehicle insurance policies that you buy have an expiry date of one year. When you decide to renew your insurance, you can reduce the cost while securing the same benefits or more if you decide to reform your policy. There are two types of car insurance available: comprehensive car insurance and third-party car insurance. In the case of either type of motor insurance, you have a choice to renew them.
Before you can understand how to reduce the vehicle insurance renewal cost, let’s understand what factors influence the premium price.
Type of Vehicle
Different types of vehicles need different kinds of car insurance. All kinds of vehicles, including cars, bikes, scooters, trucks, etc., need to be insured. Depending on which vehicle you own, you are subject to different insurance policies and premium prices. Apart from the type of vehicle, the premium price is also affected by the model of your vehicle.
Type of Insurance
The two types of insurance that we addressed were comprehensive car insurance and third-party car insurance. There are two other types that are classified on the basis of the purpose of your vehicle: personal auto insurance and commercial auto insurance. The purpose of your car influences the premium amount of your car insurance.
Vehicle Registration Location
Your vehicle's registration location plays a role in determining your car insurance premium amount. When you approach an insurance company to find out the premium cost, you will have to give your Vehicle registration details with Engine No., Chassis no., Class of vehicle, cubic capacity, seating capacity, etc. These factors and some others collectively determine your premium price.
Add-on Coverages
Add-on coverages strengthen your motor insurance, but they also affect the premium price. Different insurance companies offer different add-on coverages. If you select more add-on coverage, you may be subject to paying a lower premium amount. However, it depends on the kind of coverage you get.
Now that you know what factors affect your premium price in the first place, let’s understand how to save money while renewing your car insurance.
Get Voluntary Deductibles
A deductible is an amount that you pay from your side when you file a claim. The two types of deductibles are compulsory and voluntary. The amount of compulsory deductible is decided by the insurance company and it is mandatory that you pay the amount. However, in the case of voluntary deductibles, you can choose if you want to opt for it or not. Plus, you get to decide the amount. The thing with voluntary deductibles is that the higher the deductible, the lower the premium. Hence, you can save money on the premium amount at renewal if you choose higher deductibles.
Apply For No Claim Bonus
This is a benefit offered by almost every car insurance company. No Claim Bonus means that if you haven’t used or filed for any claim within the period of validity of your car insurance, you are subject to receiving discounts at the time of your motor insurance renewal.
Renew Before Expiry
Do not delay in filing for the renewal of your car insurance policy. Always keep track of your insurance’s expiry date. Some insurance companies also have a buffer period of certain days after you have passed your expiry date. But if you renew your car insurance after it has expired, you might not get the chance to secure a No Claim Bonus or the other benefits that you would get if you applied to renew before the expiry date.
There are simple ways to protect your car, and there are simpler ways to do that while saving your money. However, the goal should not be to get the cheapest car insurance but the most secure one that offers all the benefits of your choice.