There could be a time when you want to switch from one motor insurer to another. The procedure is very simple although you can not change the insurer mid-term.

At the time of renewal of the insurance policy it is advisable to change the insurance company (is you want to). . The new insurer will carry forward all the benefits extended by the existing insurer.

Possibly Related Posts:

• Car Insurance Validity
• HOW TO LOWER AUTO INSURANCE BILL?
• Motor Car Insurance| Private Cars | Explained

You can continue to renew your policy from the previous city if you have a dependable insurance agent who has been handling all your insurance needs for a long time. Car insurance policy is valid all over India and, hence, the city of purchase is not material. However, if you had taken insurance from a dealership in the previous city, then you should renew it from a dealership or an agent in the new city who can help you in case of a claim.

Possibly Related Posts:

• Motor Car Insurance
• HOW TO LOWER AUTO INSURANCE BILL?
• Motor Car Insurance| Private Cars | Explained

Following are few tips on saving on your Motor Insurance premium:

• The CAR – its make and model - Each car because of its make and model has its own claim record and the insurer prices the vehicle based on its claim experience. Few models are more claim-prone because of their structure or usage. For a make/model with favorable loss ratio, the discounts offered would be higher than that of makes/models that frequently meet with accidents. The incidence of accidents depends on the location and attributes of the driver. Some make/models have high-priced repair costs. Discounts depend on past performance and repair cost of the make/model of the car.
• Driver’s gender – The discount depends on the policy of the insurers, however gender of the driver helps to lower the motor insurance premium. As some insurers consider male drivers better than female drivers, and therefore give them some discounts while others believe the opposite (mainly in the west).
• City – where the vehicle will be driven – Now cities and towns where the vehicle is used or registered are also taken into consideration, other than the two zones. Premiums are calculated based on the location and keeping the various factors like,   
  congestion or high density of vehicles, high incidents of theft, rough terrain etc. The location is important for deciding on the discount to be offered. In congested cities with bumper-to-bumper traffic, the chances of smaller claims for scratches and dents are more whereas for a highway-driven vehicle, the chance of the vehicle meeting with a major accident is comparatively higher.
• Driver’s Profession – The occupation of the person driving/using the car is vital for premium calculation. For example, an office goer will use the vehicle to commute between office and home whereas; a retailer will be using it extensively.
• No Claim Bonus (NCB) – Premium due for renewal is discounted if there is no claim preferred during the currency of the expiring policy. This discount is allowed as a percentage on the ‘own damage premium’ and the same is increased every year to the next slab if a claim for damage to the vehicle is not preferred. This discount is known as ‘no claim bonus (discount)’.
  This discount goes up to 50% and the discount earned stays with the policy holder even if the vehicle is sold or if the customer wants to get the same transferred to a similar vehicle owned by him/her. An NCB earned can also be kept in abeyance and utilized on a car bought at a later date. It is, however, important that the customer renews a policy in time as the NCB lapses in case of delayed renewal (break in insurance beyond a stipulated time period).
• Voluntary Deductibles - If the customer desires, he/she can opt out of small claims for minor damages. A voluntary deductible discount is offered and the discounts can go up to 35% of the premium for vehicle damage. Availing this cover, insured voluntarily agrees to bear the stipulated amount of claim and the insurance company will pay a claim only for the damages in excess of this limit of voluntary deductible.
• Safety features - Installing an anti-theft device or other safety features (like anti-theft device, air bag, etc) reduces the risk perception of the vehicle in the eyes of the insurer which in turn increases the discount (2-5%) but it is important to fit an approved make to claim the discount.
• Member of Automobile Association – If the customer is member of any designated automobile association, he/she can avail a discount on his/her ‘Own Damage’ premium (applicable for private car and motorized two wheeler policies). A discount of 5% is given on the own damage premium, subject to a maximum of Rs 200/- for a private car and Rs 50/- for a two-wheeler.
• Concession for laid-up vehicles - If the vehicle is garaged or is out of use for some period (minimum of two months), the existing policy scope can be restricted for parking risks and the customer can avail a concession during renewal of the policy either by way of extending the period after expiry or a credit to the renewal premium.
• Buy/renew car online – Some insurers, including Royal Sundaram and Bajaj Allianz, offer a higher discount when you buy or renew a private car online. The insurance company has a considerable saving on processing and distribution costs which are passed on the customers.

Possibly Related Posts:

• Motor Car Insurance
• Car Insurance Validity
• Motor Car Insurance| Private Cars | Explained

The basic terms:

Insured – Owner of the private car
Insurer – The Insurance Company

Under the provision of motor vehicles act all vehicles running in the public should have car insurance policy. The car insurance policy can be either

• Third party or
• Comprehensive insurance policy.

Third party Car insurance policy covers only the inter-alia accountability of the vehicle owner for loss or damage to life or property of the third parties.

Whereas comprehensive Car insurance policy covers in addition to third party accountability, loss or damage to the vehicle itself by way of accident, theft, etc. and specified dangers

Motor Insurance Policy Covers

Section 1. Loss of or damage to the vehicle insured

The company will reimburse the insured against the loss or damage to the vehicle

1)      by fire, explosion, self ignition or lightning

2)      by burglary, housebreaking or theft

3)      by riot & strike

4)      by earthquake

5)      by flood, typhoon, hurricane, storm, tempest, inundation, cyclone

6)      by accidental external means

7)      by malicious act

8)      by terrorist activity

9)      whilst in transit by road, rail, inland-waterway, lift, elevator or air

10)  by land slide, rockslide

Cost of protection to the nearest car repair service- Rs.1500

Vehicle Valuation

The car is neither to be insured for reinstatement value nor for depreciated value. It is to be insured for second-hand value in the local market for a similar type of car for a similar model. In the event of loss, the liability of insurance company is the maximum compared to the market value or the amount of insurance whichever is less.

Factors determining premium of a car

• Cubic capacity
• Year of car
• Geographical Location
• Value of car proposed
• Various extensions chosen

Payment in case of claim for comprehensive cover: In case of an accident, the insurance company pays for cost of damaged parts which are to be replaced and the labor cost to repair the vehicle.

Eligibility for complete reimbursement: It is all subject to a deduction or depreciation at the rates mentioned below in respect of parts replaced

For all other parts depreciation will be as below

The insurance company will not be liable to make any payment in case of

• Consequential loss, depreciation, wear and tear, mechanical or electrical breakdown, failures or breakages
• Damage to tyre and tubes unless the vehicle is damaged at the same time, in which case the liability of the company shall be limited to 50% of the cost of replacement
• Any accidental loss or damage suffered while the insured or any person  driving the vehicle under the influence of intoxicating alcohol or drugs

Section II – Liability to third parties

1. Death of or bodily injury to any person including occupants carried in the vehicle (provided the occupants are not carried for hire or reward).
2. Damage to the property other than property belonging to the insured

Section III – Personal Accident Cover for Owner Diver

Due to bodily injury/death sustained by the owner-driver of the vehicle by violent accidental external and visible means which independent of any other cause shall within six calendar months of such injury results in

Apart from the above covers the private car insurance policy can include the following endorsements at discounts and payment of additional premium

• Discount for membership of recognized automobile associations
• Installation of anti-theft device
• Personal accident cover to the insured or any named person other than paid driver or cleaner
• Personal accident to unnamed passenger other than insured and the paid driver and cleaner
• Personal accident cover to paid drivers

Deductibles

It means the minimum amount which cannot be claimed

1. Compulsory deductible - Rs.500 for each and every claim
2. Voluntary deductible – The client whilst taking a policy can decide on voluntary deductibles thru which the insured may avail a discount on the premium
3. Legal liability to employees of the insured other than paid driver who may be traveling or driving in the employers car

The sample insurance policy detailed above is the traditional insurance policy still operated in India. Few insurance companies like Cholamandalam, TATA AIG have launched new motor insurance policies which cover even depreciation, loss of driving license, daily allowance.

Possibly Related Posts:

• Motor Car Insurance
• Car Insurance Validity
• HOW TO LOWER AUTO INSURANCE BILL?