5 tips to get the best premium rates for own damage car insurance

Deciding on the right own-damage car insurance policy that adequately protects your vehicle at an optimal premium rate can be confusing. This blog shares five practical tips to help you make an informed decision and get the best premium rates for your ‘own damage car insurance’ in India. Whether you are buying car insurance for the first time or renewing an existing policy, these insights will assist you in maximising coverage at an affordable premium.

1. 5 tips to get best premium rates for own damage covers 

This section covers the top 5 tips to get the best premium rates for own damage covers: 

1. Tip 1: Evaluate insurance provider and policy carefully

Evaluating and shortlisting options wisely before purchasing a policy is crucial. Here are some aspects to assess:

• Claims settlement ratio: Choose a provider with a high settlement record. This indicates financial stability and fair claims processing.
  
• Reviews and ratings: Check policyholder reviews on social media and rating platforms. This gives insights into service quality.
  
• Coverage offered: Compare coverage of own damage and associated add-ons across plans. Opt for optimal protection.
  
• Network garages: A wider network ensures smooth repairs, especially in your city.
  
• Premium rates: Shortlist plans offering desired coverage at competitive premiums.

Analysing these parameters will help identify your car model’s ideal insurance provider and own damage policy.

2. Tip 2: Purchase high own damage cover

Own damage premium majorly depends on the Insured Declared Value (IDV) of the car insured. IDV is the maximum claim amount the insurer will pay in case of total loss or theft. Here are some tips to get maximum IDV and, by extension, optimal own damage cover:

• Declare the correct IDV based on the vehicle’s market value. Understating it can reduce claim settlement.
  
• At renewal, ensure IDV is aligned with the vehicle’s depreciated value. This reduces premium spike.
  
• Opt for add-on covers like engine protect, consumables, etc. This can help increase the IDV.

Choosing a higher IDV ensures you get the car’s current market value in case of unfortunate incidents. It leads to a higher own-damage premium but gives you optimal protection.

3. Tip 3: Accumulate no claim bonus

One of the most significant factors impacting the ‘own damage premium’ is the no-claim bonus (NCB). NCB is a reward for not making any claims during the policy term. Here are some ways to earn maximum NCB:

• Avoid small claims: Do minor repairs yourself instead of making a claim.
  
• Renew on time: Delayed renewals can break NCB continuity.
  
• Transfer NCB: When selling your car, obtain the required documents from your insurer and transfer to a new policy.
  
• NCB protection cover: Try to retain the NCB even if you make a claim. You can do this by paying a nominal add-on premium.
  

Each year of no claims can give you an NCB discount on your own damage premium. Maintaining a high NCB can significantly reduce the premiums over time.

4. Tip 4: Opt for voluntary deductible

You can lower premium rates by opting for a voluntary deductible or excess. It is the amount you agree to bear in each claim before the insurance provider pays the balance amount. Here’s how it can help reduce the premium:

• Insurers charge lower premium rates for higher voluntary deductibles as their financial liability and claim settlement risk are greatly reduced when policyholders agree to bear more out-of-pocket costs in the event of an accident or damage to the insured vehicle.
  
• Choose voluntary deductibles thoughtfully according to your budget, risk appetite, and ability to pay out-of-pocket expenses if required. Thoroughly research the various voluntary deductible options typically offered by insurance providers.
  
• At the time of policy renewal, you have the flexibility to modify the voluntary deductible amount to achieve an optimal balance between the premium savings you get by choosing a higher deductible and keeping your potential out-of-pocket expenses due to the deductible at a manageable level.

While deductibles reduce payouts in case of claims, they help lower annual premiums. A voluntary deductible is an effective way to optimise your own damage premium payment.

5. Tip 5: Utilize Online Insurance Premium Calculators 

Online insurance premium calculators have revolutionised the insurance purchase process. They provide a platform to see policies based on coverage, inclusions and premium quotes. One can leverage these platforms in the following ways:

• Get quotes based on multiple parameters. This minimises research efforts.
  
• Use filter options for cashless garages, add-ons, etc., to see customised quotes according to your preference.
  
• Understand premium break-up clearly. There are significant differences between own damage, third party, and add-ons.
  
• Get a quote by entering details like the car’s registration number.

Using online insurance premium calculators can drastically reduce policy research time. One can quickly identify and purchase the most optimal own-damage car insurance policy according to budget and needs.

2. Conclusion

Choosing adequate own damage cover at optimal premiums requires you to make informed decisions based on policy features and pricing. By following the tips in this blog, you can identify and purchase the right car insurance tailored to your budget and coverage preferences.

Periodic review of IDV value, NCB earned and deductible selected will further help optimise premiums payable over the long term. Leverage online channels for their transparency and ease of purchasing policies. Adopting these smart tips and best practices will ensure you get the best premium rates for own damage car insurance.

3. Frequently Asked Questions 

What factors affect the premium rates for own damage car insurance?

Factors including car’s maker, model, year of purchase (age), fuel type, engine capacity, and location significantly influence the premium rates for own damage insurance. Premiums also vary based on the Insured Declared Value (IDV) which is the maximum claim amount payable by insurers.

How does the No Claim Bonus (NCB) impact the premium rate?
No Claim Bonus (NCB) can substantially reduce premiums on renewal for every claim-free year. Top insurers in India offer significant discounts based on consecutive years without claims.

Can opting for a higher voluntary deductible help one reduce the premium?
Opting for a higher voluntary deductible can help one lower their premium payments. However, opting for higher voluntary deductibles also means that you pay more out of your pocket during claims. One should carefully evaluate their finances before choosing this option.

Are online car insurance policies more affordable than their offline counterparts?
Many insurers provide exclusive online discounts on own damage insurance premiums due to lower administrative costs. Online insurance platforms also enable easy discovery of the most affordable policy based on comparison tools.

What role do customisation or add-on covers play in determining premium rates?
While add-on covers like engine protection plans can help enhance vehicle coverage, they can also increase overall premiums. To optimise insurance costs, it is better to limit add-on covers to essentials directly related to the car model and driving needs.