You took to so much of a hassle while initially buying an automobile insurance policy for yourself the first time. Then why did you conveniently forget to review your policy in the following years when renewal was due!
It’s been surveyed that most car owners blindly go on renewing their car insurance policies. It sort of happens like this:
- You are given a call from your insurer and told about the renewal date and discount offered on renewing before that date. On the surface, you would think that it is better than the year before as there is an additional discount.
- You fix an appointment with the company agent, and pay the amount with this satisfaction in mind, that you are getting a good advance payment discount and no-claim bonus. Then you get the instant relieve that the process is over and you can carry one driving without having to think about this issue for another year.
- In many cases, when the due date is near, the insurer just mails you a letter stating expiry including the premium amount for renewal. Within the envelope, there will be another property addressed envelope for you to mail back a check paid to the company. They just make the process so easy.
- But the reality is that, you could have bargained for an even better deal by expanding your options, or could have easily compared for a cheaper plan offering more or less the same benefits.
But this will take a little time of yours, and most people neglect this investment of time, and in reality lose quite a good amount of money by paying unnecessary insurance premiums which they could have saved easily.
But fear not.
These days company representatives or appointed agencies have a big presence online. It is really not that difficult to get more quotes to compare between.
An easier way is to go and compare the policies at comparison sites for different categories of cars, where you can see all good and bad features of the companies to get a better idea at once.
Auto insurance websites usually only need you to input some details on your identification and vehicle details. After which, they present you with a list of plans that you can qualify for.
Then there are conventional operators who do not have a strong web presence.
They can then be found via business listing, directories or even classifieds advertisements. Just a simple call up their hotlines and you can expect a quotation in your email by the end of the day.
Such is the ease of search process that you wonder why not enough motorists actually sieve out the market before signing an extension to their policy plans.
Here are some features to scrutinize:
1) No-claim bonus (no claim discount)
The basic insurance rates are more or less the same in all companies.
What varies is the no-claim bonus that each company offers. This brings a variation in the overall rate of the premium. This discount usually works on an increasing basis.
So for each continuous year where you have made no claims, an additional discount rebate will be deducted from the premium. There will usually be a ceiling to the maximum discount you are eligible for.
An example is a 10% rebate each year up to a maximum of 50%. In this instance, you will achieve 50% by the end of the fifth year of driving. Thus you must request a quote from all reliable and known companies.
2) Opt for Voluntary deductible
If you opt for a voluntary deductible, you may even lower the rate. Raising the voluntary deductible by yourself will lower your premium quite much, and this you can do only when you study the papers in detail.
By going this route, you are not only showing to the underwriter that you take more financial responsibility for accidents, but it also reduces the risks being borne by them.
When there is a lower risk, a lower profit can be satisfactory, then the option of a lower premium can be seriously considered.
3) You may get lifestyle discounts
These are discounts given to policy holders depending on their lifestyle and social status.
Make no mistakes about it. The nature of your job scope and type of lifestyle you are accustomed to can affect the premium you have to pay.
And if the insurance company believes that you have a higher lifestyle and strata in society, you may be entitled to a higher discount on the premium, so that you stick to this company as an important customer.
A long term relationship with a wealthy client is many times more profitable than a short term one.
This is why major corporations can pull out all the stops to acquire clientele with high profiles or high net worth. There is also the small prospect of reaching out to the personal and professional networks they associate themselves with.
4) Lowering your IDV
Each vehicle has an insured declared value or IDV. This value determines the premium, and is estimated by the insurer. It depends on this value that what amount you will be paid on accident, or destruction of your car.
However, if you do not bother to get a lower amount upon such circumstances, and prefer more to lower your premiums, then you may lower the IDV on your own.
If you are not someone who drives a lot, it might make sense to choose a lower IDV. Because the lesser you drive the smaller the probability that you will get into an accident. When that possibility is low, compromising on IDV is not a big deal.
For housewives or those that work from home, tweaking this feature of a policy can save you a huge amount on premium.
5) Use of Anti theft device
Anti theft devices are seen in high regards by insurers. If you have an anti theft device installed in your automobile, then you may ask for a discount on your premium on this ground, and you will instantly get one.
The logic is that having such an equipment installed on your car, the lower the probability that it will get stolen by individuals or syndicates. Since the risk is lower, a lower price makes sense.
Following a few or all of these steps will lower your policy premium quite impressively, and you may start saving a few bucks that can appear like a bonus.