If you own a car, you should always ensure it's covered by insurance. In India, you must have at least third-party insurance to defend you and your vehicle from many possible losses and damages.
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| 8 Things not to do when Renewing your Car Insurance |
Imagine going outside in the rain and getting wet because you didn't want to use the umbrella your friend just gave you. Well, having insurance is like taking that umbrella and staying dry and safe.
This is why you should not let your car insurance policy expire. If you drive a car without insurance, you will not only be breaking the law but won't be fully protected if something terrible happens.
Now that you know why it's so essential to renew your insurance, here are a few common mistakes you can easily avoid when renewing your car insurance:
1. Taking too long to renew your policy
One of the most important things to remember while renewing your automobile insurance is to do it on time!
Buying car insurance will be suitable for a certain amount of time (usually a year), after which you will need to renew it.
It's like getting Netflix: you buy a subscription and then renew it every month to keep watching all your favorite shows at once.
Just like with Netflix, if you don't renew your policy when you're supposed to, it will be considered expired, and you won't be able to use any of its benefits.
If your insurance lapses and there is a gap in your coverage, you could get fines and penalties for driving without insurance and lose all the benefits you have built up.
Some insurance companies might give you a grace period of 30–45 days to make payments and get back on your policy, but remember that your insurance doesn't cover you during this time.
2- Not comparing policies
Before you buy a new phone, you can spend hours online researching the best brand and model for your needs and budget.
So, even though it may be easy to renew your current policy, comparing plans and find the best one for you may be worth your time. You may find a better insurer with additional add-ons.
When your auto insurance is up for renewal, this is the ideal time to do so because you can continue working with the same insurance provider.
3. Choosing the wrong policy
Like choosing a phone, picking a policy is essential.
Car insurance has two primary forms. India's Motor Vehicles Act says you must have at least third-party-only insurance to cover damage to other people.
Nevertheless, if you want total protection for you and your automobile, you may pick a comprehensive or own damage coverage that covers your car and its passengers!
You may choose the finest insurance after you know what each one offers.
If you rarely drive or are a careful driver, third-party-only coverage that insures third parties but not your automobile may be enough. That would cover your legal responsibilities and cost less.
4. Failing to take advantage of opportunities to modify or update your information
Your insurance provider may only be able to provide you with the best possible protection if they have the most accurate and up-to-date information on you.
If you just moved or got a new phone number, your insurance company may need help contacting you because they need to change their records.
If your information or personal details have changed since you first bought your insurance or the last time you renewed it, you should update your policy as soon as possible.
5. Failing to make the most of your NCB opportunities
Do you believe you shouldn't be rewarded if you have a clean driving record throughout the time that you have been covered by your insurance and haven't been in any accidents during that period? To put it simply, we concur!
If you haven't filed any claims throughout the policy year, your insurance company may reward you with a "No Claim Bonus," sometimes known as an NCB. This is a discount (between 15 and 50%) that you will receive on your premium when it comes time for it to be renewed, and the more years you have gone without filing a claim, the more significant your discount will be!
Hence, when it comes time for you to renew your insurance, you need to make sure that you check to see whether you are qualified for this NCB and that it is applied to the rate that you will pay in the future.
6. Selecting the incorrect IDV
The current market worth of your automobile, known as its "Insured Declared Value," or IDV. It is also the most your insurance company will pay you if your vehicle is destroyed or stolen, so it can also affect your premium.
Your car may be essential to you, but as it gets older, its value goes down. This is called "depreciation," and the rate at which it occurs can cause the IDV of your car to decrease over time.
Now, since many insurance companies let you select your IDV (usually, you can change it by 15% from the current value of your car), you need to be careful about choosing the right IDV.
Remember that the higher your IDV, the higher your premium. But if it's too low, you might get a lower premium, but the value of your car might need to be fully covered.
7. Not taking your voluntary deductible into account
When renewing your car insurance, you may find ways to lower your premium. Who doesn't want to save money, after all? You can choose a voluntary deductible as an easy way to do this.
Deductibles are just the amount you have to pay out of your wallet before your insurance company will pay a claim or reimburse you. You have to pay a required deductible, but you can also choose to pay more as a Voluntarily Deductible.
8. Wrong add-ons
When you pick Own Damage or Comprehensive auto insurance, you may add-on coverage for your car.
These add-ons may increase your rate, but they personalize your insurance.
As your insurance policy renews, you may add or remove any coverage. Choose add-ons that fit you and your automobile, as they raise your premium.
Examples include:
This protects your NCB even if you make a claim.
Zero Depreciation Cover: If you have this cover, your insurance provider will not consider the depreciation of your vehicle and its components when filing a repair or reimbursement claim.
Technical Help Cover—helps you if you break down or have flat tyres.
Passenger Insurance protects your passengers in an accident.
Online vehicle insurance renewal is simple nowadays. Remember to renew your insurance before it expires to avoid coverage gaps, which may have catastrophic repercussions.
If you avoid these auto insurance renewal blunders, you should be able to drive stress-free.
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