How to Reduce the Cost of Your Car Insurance Renewal?
Fear of driving comes naturally from the thought that one day, some unforeseen event could happen on the road. As a result, many people avoid driving. There are often issues like potholes and rash driving. For these reasons, this fear is well justified. This goes to show how important car insurance is. It is a must-have for people who own a vehicle. It provides peace of mind and security for the owner of the vehicle in the event of an unfortunate incident.
There are two types of car insurance policies. A comprehensive car insurance policy provides comprehensive coverage for all of your vehicle’s features and risks. A third-party policy provides a basic level of coverage for certain types of claims. A comprehensive policy can be more expensive than a third-party policy. That being said, the cost of car insurance can also rise over time. This is why it is important that you keep an eye on the renewal price to avoid getting stuck with higher expenses. Here are a few tips that can help you reduce the cost of your car insurance renewal:
Purchase long-term coverage
One of the best ways to avoid the expense of an annual renewal premium is to not renew the policy each year. You have another option of buying a multi-year car insurance policy. This type of policy provides coverage for a long term. A long-term car insurance policy can provide you with better coverage for a long time. It saves you money and can even lower your insurance renewal rate. Moreover, it offers you the chance to save money between your premium payments. The only thing that you have to worry about is making sure that your car will be used for the policy’s longer term.
Use NCB cover
No-claim benefits are usually available as an added coverage when you buy a car insurance policy online. This benefit offers you a discount in exchange of avoiding making a claim for a long duration of time. Your benefit is linked to the price that you pay to renew your policy. It’s simple: If you drive safely, you won’t get into an accident and get no damage on your vehicle. This, in turn means that you would not have to make claim. If you purchase the no-claim benefits cover while buying the policy, your insurance company will give you a discount on their premium with each renewal. This means while you pay more money for the add-n while buying, your premium will go lower with each renewal until it reaches the insurer’s discount limit.
Set the right IDV
In most cases, car owners tend to mistakenly believe that the vehicle’s IDV and the vehicle’s resale value are the same thing. This mistake can lead to costly mistakes and inaccurate claims. IDV is essentially the money that your insurance provider would pay in the case of a total loss of your vehicle. This could be the car being damaged beyond repairs or theft. While it is the insurance provider that sets the initial IDV of the policy, you can ask for a better one. If you go for more IDV, you essentially buy more coverage and thus, might have to pay a higher premium. It’s important to set the IDV correctly to avoid paying a high premium. Having the right IDV will help you avoid paying more than what you wish for.
Remove some add-ons
An add-on is a benefit that’s included in a car insurance policy to offer you a more refined coverage. Various add-ons can cover you for different situation with your car. However, these are only paid benefits that are available with a comprehensive policy. While they can help you get the coverage you need, they also raise the cost of your policy. Ideally, before you decide to buy any add-on, you should make sure that it is necessary. If it is not then, it does not make sense to keep paying extra premium for unnecessary coverage. Hence, you should remove the add-on from your policy.