Insurance has been in India for a long time now, and with its many bifurcations, it has been helping people protect their precious belongings; one such type of insurance is car insurance.
People spend lakhs of rupees to buy a car, and easily another few lakhs or thousands, if it gets damaged in an accident, or worse, if the car is stolen. This is where insurance can help you cover expenses for the loss. Moreover, the Government of India has made motor insurance mandatory while driving on the Indian roads.
Most of the people who own more than one car, often notice the difference between the premiums of their cars. Many car owners are still not aware of the fact as to why it is so. If this question bothers you too, read here to know the actual reasons for the difference in the premiums of the policy.
- The type of cars you own: The type of car does make an impact on the insurance For eg. You own a hatchback which is for daily commute and a 4×4 vehicle which is only used for long trips. Since hatchbacks are less prone to accidents and expensive breakdowns, they have lower insurance premiums, whereas, repairing a 4×4 can cost a lot. Hence, there is a huge difference in the premium amount.
- Your location of residence: The rule of insurance is quite simple; higher the risk, higher the premium. If you stay in a locality where theft, crashes and vandalism are in high in frequency, the price of premium will be high.
- Your Driving history: When an insurance company registers your car for a new insurance, they do run a background check sometimes. As your license number has to be provided while applying for insurance, the insurance company is able to extract information about your driving record. This means if you have been caught rash driving, driving without a helmet/seatbelt, skipping the red light, etc., the company will consider these as acts of dangerous driving and will raise the insurance
There are various factors which are considered by the insurance company when deciding the premium for car insurance. If you have queries on Car Insurance premiums do feel free to drop us a message at PL-India Motor Insurance and we shall revert at the soonest. Alternatively, do email us at firstname.lastname@example.org.