How to compare deals to get auto insurance with the best price

Auto insurance quotes can vary greatly depending on who you use and the options you choose - this is exactly what is required for you, if you compare rates online

The same person with the same address, same car and can be very different car insurance get quotes from different insurers.

But if you have the system correctly understood, you can compare large savings by car insurance quotes before you apply a policy.

Most people £ 237 or more are approximately of shopping, working a comparison site. But what you have to know that everything is working well?

This is our guide easy to follow car insurance compare quotes.

The cheapest cover is not the best coverage

It is an important thing to be aware - if you compare car insurance quotes you try not to get the cheapest policy. You try to get the best price for the right policy for you.

Most car insurance comparison tools have an easy way to show that the policy included extras such as courtesy cars, legal, key exchange and which surplus. When you compare policies, make sure that you are looking for insurers who offer the protection you really need.

Do not to excess be tempted

During your deductible may increase to make a cheaper policy, it can be risky. Never increase the excess amount, as you struggle to pay, because you have to work before your insurer pays.

Ring to other insurers

all insurers even listed on sites no price comparison, so you can not compare at once. But it may be worth ringing to or receive an offer directly from their websites, as they may be willing to offer you a better deal. There is no direct line, Aviva and Zurich on price comparison and they are three of the largest insurers.

How to cut your car insurance bill?

Cars can not only your family drive around the city, they also can make a dent in the household budget. Such cost is car insurance, which is a prerequisite for the ownership of the vehicle, but is having a great day. However, it is possible to save money on your car insurance if you understand what factors affect your premium.

Anil Sehgal, the founder of financial advice portal "i-save ', said:" Insurance companies have different clauses in which one of the premium discounts on car insurance can avail. to understand these functions, customers can be aware of this discount can help be availed, the eligibility for these cuts and these cuts makes financial sense. "

In addition, premium rating criteria changed parameters on four parameters at the time the ruling, ie. geographical area, capacity, price and age of the vehicle. "Are now, considered several new parameters in a de-tariffed era premiums in the determination so that various ways to reduce your insurance bill," says Vijay Kumar, head of motor insurance at Bajaj Allianz General Insurance.

You can, for example, the premium of 10-30% reduced simply to pass through a correct and appropriate information to the insurer. Thus, it is not always a quote from a recent insurance company to obtain, but a few simple steps and attention to details can help you save on your car insurance. Here they go:

Discount / bonus: If you have not made against your car insurance for a given year, you can enjoy the benefits of "No claim discount any claims as a percentage of specific get reducing your bonus the following year no claim bonus increases with. without incident and usually with 20% and to start each year to a maximum of 50% of the component 'Kasko Premium "your car insurance.

Voluntary insurance: Insurers offer a discount on your premium vehicle when you wear associated with a certain amount of loss with each request. voluntary deductible is the amount you agree to pay a claim before the insurance company takes the balance. More voluntary deductible you agree for your lower premium. "The reductions associated with this function generally vary between 20% and 35% of the premium, up to a maximum of 3,500 Rs. However, it must be the amount of voluntary deductibles against cuts check to make sure that the amount of the rebate actually than the be voluntary deductible higher, "says Sahgal.

Brand and model of car: each model has its own demand and record prices, the insurer of the vehicle based on its claims experience. Some models may be more prone to protest due to their structure or use, and the premium account all these aspects. "May depend where some brands / models prohibitive repair costs. Discounts on the cost of repairs on some makeup / models," says Ajay Bimbhet, managing director of Royal Sundaram Alliance Insurance Company.

Car insurance premium & calculation

Automobile insurance premium is calculated based on different parameters.

Car insurance is not only compulsory by law, but also a prudent policy for vehicle owners. As per the rules, all motor vehicles should be insured at least for third party liability.

However, considering the high risk of accidental damage to your vehicle and the high cost of repairs especially for newer or premium cars, it is advisable to cover your vehicle under a comprehensive insurance policy.

The minimum legal insurance under Motor Policy A, or 'Act Only Policy' covers unlimited liability in case of death or bodily injury to third party, and damages to third party property to the extent of Rs 6000.

A comprehensive insurance policy (Motor Policy 'B') covers not just third party liability but losses due to accident, fire, theft, floods, earthquakes, and other specified perils. Damages to third party property above Rs 6,000 can also be covered under this policy.

Car accessories like music systems, air-conditioners and so on can be covered by paying additional premium. By paying extra premium, you can also cover against personal accident to yourself, spouse, family members, employees and so on.

Insurance premium

You can obtain an insurance policy by paying a premium to an insurance agent or to the insurance company. The premium amount is calculated based on the car's market value, which is a function of the make and model, condition of the vehicle and the resale value, and the value of its accessories. Premiums are paid annually, and the insurance is valid for a period of a year.

The market value of the car should be estimated every time you renew your premium. The insurance must be renewed prior to the expiry date of the policy, as it is illegal to drive without a valid insurance cover.

The insurance premiums are regulated by the All India Motor Tariffs, and are therefore uniform across insurance companies. For a comprehensive policy, the premium covers all stated risks, but if you wish to exclude certain risks – such as earthquake – you may inform the insurance company and they will offer you a discount on the insurance premium.

You could also opt for voluntary excess i.e. undertake to bear a fixed percentage of the loss for every claim, and thus avail of a discount in premium. A five percent discount (subject to a maximum of Rs 100) is also available for members of recognised automobile associations.

Motor insurance policies are normally taken for a period of one year. While you cannot insure your vehicle for more than a year, a policy for a shorter term is available, which is suitable if you are planning to sell your vehicle within a few months. The premium for this short period insurance is more expensive than the pro-rata premium for a full period insurance.

No claim bonus

If you do not make any insurance claims during the duration of your insurance policy, you are eligible for a no claim bonus. No claim bonuses are discounts on the insurance premium for the following year (i.e. discounts offered on the renewal premium) and are as follows:

1.No claims for one year: 20 percent discount on 2nd year premium

2.No claims for two years: 35 percent discount on 3rd year premium

3.No claims for three years: 50 percent discount on 4th year premium

4.No claims for four years: 65 percent discount on 5th year premium

The discount is applicable to that part of the premium that covers 'own damage'. You can avail the bonus when you renew your policy, or within 90 days of its expiry.

If you sell your car you are eligible for the bonus, which is adjusted against the premium of a new car, if the purchase is made within a period of three years. In case you purchase a used car, you can transfer the existing insurance policy to your name by informing the insurance company within 14 days from purchasing the car.

Malus

On the other hand, if you make a claim in consecutive years, the insurance company will load an additional penalty or malus on your renewal premium. If you make claims every year, your malus will be as follows:

1.On 2nd year renewal premium: Nil (i.e. your no claim bonus reduces from 20 percent to nil)

2.On 3rd year renewal premium: 10 percent

3.On 4th year renewal premium: 30 percent

4.On 5th year renewal premium: 50 percent

For example, if you do not claim any insurance in the first year you are entitled to a 20 percent bonus on your 2nd year premium.

If you claim insurance in the 2nd year then you are not eligible for any discount on your 3rd year premium, i.e. your no claim bonus is nil for the 3rd year premium. If you do not make any claims in the 3rd year you are again eligible for a 20 percent discount on your 4th year premium.

Premium for car insurance may go up

The premium you pay for insuring your car could go up sharply, though not immediately. Insurance Regulatory and Development Authority (IRDA) chairman CS Rao said on Thursday that the regulator has prepared a roadmap for allowing insurers a free hand in determining premia by December 2006. If that happens, premia on motor vehicle insurance are bound to increase by around 50%.

IRDA in a paper, ''road-map for a tariff-free regime'', said that the insurance companies and policy buyers had been voicing the demand for removal of tariff as it was considered to contrary to free market principles. The authority has accordingly considered moving to a tariff-free regime.

At present, the general insurance companies pay claims of around Rs 118 in the motor vehicle sector for every Rs 100 collected as premium .

In third party (TP) insurance, where the insurer pays for damages caused by the insured vehicle to a person hit by it, for every Rs 100 earned as premium the insurance companies pay Rs 220 as claims. This leaves a big hole in the general insurance company's balance sheet.

A senior official of a general insurance company said that the motor vehicle segment could break even only if the claims amount to not more than 70% of the premium collection. At the present tariff, selling insurance policies in the motor vehicle segment is a loss making proposition. 

Therefore, private companies are reluctant to sell TP insurance policies. But, the public sector companies have no choice but to sell it to the customers which affects their balancesheets adversely.

Therefore, it is imperative that the tariff in the motor vehicle segment would go up as soon as it is de-tariffed. Since it is aware that this would affect a large number of policy holders, the regulator would like to go slow in freeing up premia in the motor vehicle segment.

While all lines of business would be detariffed ultimately, it is likely that the motor vehicle segment might not be included in the first phase, which could be ushered in as early as January next year.

However, the general insurance companies are likely to oppose the move to postpone detariffing of the motor vehicles segment.

A senior official said that they are loosing badly in this segment, while they make some money in sectors like industrial fire and engineering because of tariffs fixed by the regulator. If the regulator removes tariffs selectively where they make money, they would be hit from both sides, he pointed out.

It pays to drive around for best car insurance

For most car owners, the first insurance cover they purchase is the one bundled in by the car dealer. Most do not bother checking out what else is on offer as many dealers throw in the cover virtually free.

"These covers are not different from what is offered by the insurer. The pricing is built in such a manner that the dealer ends up paying the premium amount instead of the customer," says Ajay Shah, head of customer service — Motor, ICICI Lombard General Insurance.

But what the buyer doesn't realise is that the car dealer is eyeing a hefty commission on the renewal premium. Hence, a customer should shop around for premium deals, especially at the time of renewal, instead of merely accepting what the agent offers. Most company websites offer online premium quotes.

You can also browse through various insurance portals such as apnainsurance.com or click2insure.in, which provide premium deals that match your requirement. This becomes an essential exercise as you could cash in on lowering of premiums.

"The premiums have come down by almost 50% in the past two years because of intense competition. The insurance value has been lowered to 1.5% of the car value now which was 2% in 2008. But insurance companies have reported huge losses in this portfolio since last year. Hence, they have slowed down in certain vehicle segments starting October," says click2insure.in CEO Rahul Aggarwal.

What does your car insurance cover?

Car insurance can be categorised into own damage and third-party liability (when you cause a damage to the other person's life or vehicle). Third-party liability insurance is mandatory. But comprehensive insurance, which covers third party cover, theft, personal accident and liability are more popular among the car owners.

If you own a car with authorised bi-fuel system such as petrol/diesel or CNG/LPG, you have to get the CNG/LPG kit insured separately. The premium would be around 4% of the kit value. An additional personal accident insurance for your driver would cost you around Rs 25-30. If you want to cover other passengers up to Rs 2 lakh, the premium would shoot up by Rs 500-600.

The IDV and the premium amount

The insured's declared value (IDV), which is the sum assured of the vehicle, is computed on the basis of the car price minus the depreciation. IDV is used to determine the premium value of your vehicle.

Other factors include the city of registration, the period of coverage, cubic capacity of the vehicle and your claims history. Better the claims history, lesser would be the loading on the premium. The cautious drivers are awarded with no-claim bonus, which goes up to a discount of 50% for the fifth claim-free year.

How to use your NCB with another insurer?

You can carry forward the NCB while switching insurers. You have to sign a declaration letter and produce a copy of the renewal notice of the old insurance company, which would clearly state your eligibility for the NCB. You cannot dupe the new insurer on claims history as the new insurer would cross-check vital information with the old one.

In the next six months, the general insurance council will roll out a motor insurance bureau, which would maintain a comprehensive data base of all the car owners and their claims' history.

Claim settlement is crucial

"The incidence of claims in car insurance is as high as 35% compared with that of home insurance at 2-3%. Hence, a customer should look at the claim settlement record of the insurance company before choosing the cover," says Gaurav D Garg, managing director and CEO of Tata AIG General Insurance.

Also check if the insurer has a good network of garages, which is essential for cashless insurance.

Don't let dealers take you for a ride with motor insurance

Some dealers and manufacturers are promising free car insurance to customers this festive season. They are offering to pay premiums for up to three years. The offer is enticing to buyers as it helps them save money on the premium on this mandatory cover. Also, it helps 

them buy insurance on the spot. However, insurers point out that it is not possible to offer a motor policy for three years

"Regulations do not permit motor policies for tenure of more than a year. To our knowledge, no such multi-year product has been approved. The dealers are merely giving an undertaking to fund the premium when the policy comes up for renewal. They might have made provisions for these payments," says MukeshKumar, head of strategic planning and marketing, HDFC ERGO.

According to automobile industry experts, dealers are bundling these policies with the entire sales package, and offering to pay the premiums instead of providing a cash discount. "Strictly speaking, these are not free insurance covers, as an insurance policy can never be offered free. From the insurance company's point of view, the requisite premium is charged," says Madhukar Sinha, national head - personal lines, Tata-AIG General Insurance. "Many such bundled policies are plain-vanilla policies without add-on covers like depreciation, return of invoice, etc.

You need to understand the scope of coverage being offered before signing up," he says. Besides, since the dealer would have tied up with a particular insurance company to offer the package, your choice will be restricted.

These policies may score high on pricing and the convenience factor. "Pricing could be better than what is otherwise available in the market. Also, in the event of a claim, the dealer is likely to be more supportive and manage the liaison with the insurance company and surveyor," says Arvind Laddha, CEO, Vantage Insurance Brokers. However, according to experts, customers should take a close look at these policies before signing up for them. "Most car insurance policies offered free do not carry the necessary riders to provide wholesome coverage for a car," says Yashish Dahiya, CEO, Policybazaar.com. 

"The key factor to consider is the coverage of the policy in terms of riders like depreciation shields, engine protector, 24X7 spot assistance and vehicle replacement advantage." That is why you should study the policy to find out whether it is merely a third-party cover, comprehensive policy or a fully-loaded package with add-on covers. "The customer needs to study the coverage closely. For example, it is important to have a policy on zero depreciation as the deductibles could be very high on claims under such a policy," says Arvind Laddha, CEO, Vantage Insurance Brokers. So, compare policies available in the market with the bundled cover being offered to you before making a decision.

Also, if you are signing up for a three-year policy, find out how the dealer plans to honour the commitment. "Motor insurance policies offer standard no-claim bonuses over five years. Find out how a claim will affect the arrangement. Things could get complicated, so it is better to bargain for a cash discount instead of the bundled cover, if possible," says Kumar. 

For example, it will be difficult to ascertain the exact discount you would get in the form of free insurance, as your claims - or their absence - impact the subsequent year's premium. "A customer, who does not make a claim in a particular year gets a No-Claim Bonus (NCB), which lowers the premium for the subsequent year. Similarly, if he makes a claim, he needs to pay a higher insurance premium," says Dahiya.

Thinking to buy a luxury car insurance? A look at the must have add-ons

These days, buying a luxury car is not a big deal for many people. Thanks mainly to a host of corporate discounts and easy financing options, many don't even think twice before purchasing their fancy cars.

However, maintaining a luxury car costs a lot. In fact, one of the key issues with high-end cars is the high cost of repairs — even minor damages can burn a hole in your pocket.

For instance, the average claim size of a luxury car owner is estimated to be Rs 50,000. The sum may not be big enough to rob the sleep of many of these car owners. Still it makes sense to buy a comprehensive insurance cover for the vehicle.

Buying insurance for luxury cars is quite simple, as most covers are bundled with accessories and other car servicing packages. Now, as per law, luxury cars need only a third party liability cover as mandated by theIndia Motor Tariff.

However, given the huge bills, their repairs could run up to a lot, and it would, therefore, be wise to look for more a wholesome coverage. There is a limited network of authorised repair workshops for luxury cars and the possibility of getting the damaged parts repaired is low.

"As such, the cost of repairs/spare parts can be very high at times. Hence, it is important that one does a thorough research on the basic policy features as well as the add-ons while choosing a motor insurance policy," says Amitabh Jain, head, customer service, motor, ICICI Lombard.

A comprehensive cover with value-added features, therefore, is often recommended by experts. Over the last couple of years, car insurance covers have become highly comprehensive, offering a range of add-ons that are crucial, especially for a luxury car.

While ignoring comprehensive insurance would be a mistake, resisting the urge to splurge on all heavily-promoted add-ons is advisable. To strike the right balance, you need to do your own homework.

Here's some help in understanding the add-ons:

Depreciation Reimbursement

It is a must for every luxury car, according to insurers. Depreciation reimbursement cover offers to settle the full claim without any deduction for depreciation on the value of parts replaced.

"Depreciation reimbursement and consumable cover are crucial, as the cost of replacement of parts more prone/exposed to damage is very high and, hence, higher amount of depreciation is to be borne by the insured in case of a claim," says Ramesh Ramani, senior vice-president, consumer lines, Tata-AIG General Insurance.

Availing this add-on would be of help particularly when you need to replace highcost parts of your luxury cars.

Engine Cover

Then, there is the cost of repairing the damage to the engine, particularly due to flooding. "Such vehicles are also prone to damage due to water ingress and the cost of repair/replacement of engine is to the tune of 30-40% of the cost of the vehicle. Hence, engine cover must be taken by the owners of luxury cars," says Ramani.

Roadside Assistance

Typically, roadside garages are not capable of handling repair works for luxury cars. The servicing of such vehicles calls for a certain skill set, which is available only with the company-authorised service centres, say insurers.