Car insurance is a mandatory requirement in most countries. Despite this, the knowledge and awareness about it is strikingly low. People just buy the car insurance sold to them by the car dealer and droll out the renewal amount each year even if it hurts their pockets. However, there are plenty of things to know about car insurance renewals that are not only educating but help save you plenty of your precious money. We mention here renewal here because, after a year with car insurance, you understand plenty of things about it and thus can analyze and choose better. Here, we list down few of the must-know things about car insurance renewals.
Select the right type of plan
There are various other types of car insurance policies available apart from the one made mandatory by the law. For instance, in India, every car owner must buy a Third Party Liability Insurance. However, a comprehensive car plan insures your own car against any accidental damage. You can easily go online and study various car insurance plans to know the details and features of each.
Decide on the add-on features
Add-on features are additional benefits which add an extra layer of protection to your standard car insurance policy. Some of the most popular and useful add-on features are zero depreciation cover, hydrostatic cover, car accessories cover, etc. Ensure that you do not fall prey to any sales gimmick and choose the one that meets your requirements.
Know the IDV or Insured Declared Value of your car
You can comprehend it as the maximum sum assured of your car policy for that given year. It is calculated by subtracting the depreciation value of your car from the original value and arriving at the current market value. This is the maximum amount you get paid if your car gets totaled or damaged beyond repair or even stolen. You must always ensure that this value is correct. Furthermore, you can increase or decrease it to increase or decrease your premium amount.
Most insurance companies have tie-ups with a list of garages where you can take your car for repair. You need not pay anything there as the insurance company would get the bill directly. Check out of your preferred garage is in the list as it would free you from the hassle of claiming a reimbursement.
Compulsory and voluntary deductibles
This is the amount that you need to bear from your own pocket before the insurance company foots the rest of the amount. The compulsory deductible is decided by the insurance company and is fixed. But you can choose to raise or decrease your voluntary deductible to make your premium amount go high or low. A smart calculation needs to be done here such that you can bear the voluntary deductible in case an accident occurs.
Remember to use your No-Claim bonus (NCB)
If you made no claims in the past year of the car insurance, you are eligible for a no-claim bonus. This discount could be up to 50 percent every claim-free renewal. Depending on its amount, you can use it for discounts or carry it forward for accumulation.
Get your renewal quote
The final renewal quote for your car insurance is calculated based on your arrived quotation for NCB, IDV, number and type of additional riders chosen, the deductibles and all other features selected. You can even make adjustments to any of these to create the right balance between the facilities opted for and the premium you would be required to pay.
The time of your car insurance renewal is also the time to weigh your current provider on all parameters. If you find them lacking or are unsatisfied with their services; you would be free to shift your car insurance with another provider without losing on all the benefits that you have gained in the first year. You simply need to gather the right information to port your policy to a different insurer.
Check out the claim procedure
Before you commit to any car insurance policy; you must also look into the claim settlement ratio of that company. Even the entire procedure of claiming should be given a critical eye. The process needs to be smooth and as hassle-free as possible. It is important to know all ins and outs of this process so that you do not face any nasty surprise in the future.
Compare quotes online
Finally, you can go to a comparison site and compare the quotes you get from different insurance companies. You need to check the pros and cons of each and finally choose the best for you. The process of renewing is easy and one can do it easily from home within ten minutes or so.
You must always remember to renew your policy in time as a delay might get your policy lapsed and all accumulated benefits erased. Thus, you must be proactive about it and take the most advantageous offer.