Paying and renewing your motor insurance policy is an annual exercise and with years of owing your car, you might now be aware of what are your utmost needs and what kind of claim you may need of.
So, other than the cost aspect which is also as important, there are other vital aspects that need to be given heed to when going for your car insurance policy renewal.
While in the following year i.e. after the policy has been purchased there is thought that a depreciation in the value of the car might result in lowering of the insurance premium, there can be reasons wherein your insurance cost could even higher the next year.
And this increase can be avoided by going for policy renewal through online means, not making small claims as well as avoiding lapse of policy.
Furthermore, there is an array of factors that influence premium rate
1. Sum insured
2. Policy type
4. Car type
5. Area where the insured person lives
2. Compulsory Personal Accident:
This is also a must have as in case of any minor or major accident it will extend financial support. Also, while along with the third party insurance coverage, personal accident policy was a mandatory cover. There has been an amendment made in it since January 1, 2019 for vehicle owners with a valid DL and if other conditions as laid down have been adhered to, policyholders can opt out from having such a scheme.
As per the current schema, now the vehicle owner either needs to own a personal accident cover with a minimum sum insured of Rs. 15 lakh or can have a policy of another vehicle which is inclusive of the 'Compulsory Personal Accident cover' with the sum insured of Rs 15 lakhs.
3. Own Damage Premium (OD):
At the outset of buying a motor insurance plan, a prospective needs to choose between limited cover plan or third party liability plan or extensive car coverage plan.
This third party plan is only for covering damage met to another vehicle and is not for covering any damage to one's own car.
This is not mandated as per law but it is wide in the sense that it provides for cover for the insured vehicle in accidents or in theft and also in case of total loss. It also protects for loss met while the vehicle is in transit or due to natural disasters.
4. No claim bonus:
This is a benefit which is recovered as a discount of 20-50% on premium amount in case no claim has been made in the previous policy years. It is the first year of renewal that the policyholder becomes entitled to no claim bonus of up to 20% provided there is no claim made. And also for each no-claim year till the 5th policy year, the NCB can go higher up to 50%,
Also, this NCB becomes applicable even in a case when the policy is transferred to a new insurer or you happen to own a new car now.