April 21, 2024


Design with distinction

Factors Influencing Your Car Insurance Premium

Although third-party auto insurance is required, you do not have to break the bank whenever you need to insure your vehicle. You can make sure that you get the ideal car insurance deal by knowing the elements that influence your auto insurance premium.

What Is A Car Insurance Premium?

The amount you regularly pay to the insurer in exchange for insurance coverage is known as the car insurance premium. The insurance company will pay all the insurance coverages mentioned in the insurance policy, such as collision and liability coverages, after the premium has been paid.

You’ll be required to pay your auto insurance premiums to various insurers at various intervals. You can use a car insurance premium calculator to get a more precise estimate of the costs involved.

Factors That Affect The Cost Of Your Car Insurance

  • Make, Model, And Car Variant:

Luxury vehicles have higher premiums than more affordable vehicles because they are more expensive to repair and replace in the event of theft. The distinction between a car’s model and make is that a model refers to a particular car model, whereas a make relates to the car’s brand. E.g. Volkswagen is the car’s manufacturer, while Polo is its model. The fuel that the vehicle that will be insured burns also impacts the premium. Different premiums apply to CNG, diesel, and gasoline. Cars with larger cubic capacities or those that run on gas or compressed natural gas typically have higher premiums.

  • Location: One of the key elements affecting your auto insurance cost. The premium charged is greatly influenced by where you purchase the insurance policy and where you live. The premium will be lower if there is less traffic in your neighbourhood. The car premium tends to be higher for metropolitan areas with heavy daily traffic on the roads. ##
  • Required Coverage: Your car insurance premium may be low or high depending on how much insurance your four-wheeler needs. Although choosing comprehensive auto insurance will increase the premium cost, it is necessary. Third-party insurance is required, but you are free to choose whether or not to add collision coverage. When you add extras like a vehicle-scrappage policy, zero-depreciation coverage, breakdown assistance, etc., your auto insurance costs go up. *
  • Insured Declared Value Or IDV: The amount that represents the current market value of your four-wheeler is known as the insured declared value, or IDV. Your car insurance provider will typically determine this value, which represents your vehicle’s estimated current market value after deducting its depreciation value. Depreciation causes your car’s insured declared value to decrease over time. The higher the declared insured value of your vehicle, the more expensive the insurance will be.
  • Frequency Of Claims: If you had no claims during a given year, the car insurance companies would give you a concession on your premium for the following year. The No Claim Bonus (NCB) is the name of this benefit. Therefore, review the NCB portion before determining whether or not to raise a claim. *

* Standard T&C Apply

## All savings are provided by the insurer as per the IRDAI-approved insurance plan. Standard T&C apply

Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.