Reducing Four-wheeler Premium on Old Cars

Many of us still have our old cars, not only because of the car’s performance but mainly for the sake of the memories attached to it. Due to the sentimental value, many car owners whose vehicles are more than 5 years old, ensure that they maintain the vehicle’s performance and work towards keeping it at its optimal best. 

Reducing Four-wheeler Premium on Old Cars

While your old car is in the right condition, you may be hesitant to pay high premiums towards the car insurance for a 10-year-old car. Maintaining the vehicle properly and upholding the 4 wheeler insurance can be quite expensive and could turn the vehicle into a liability instead of a prized possession.  

Since long-term car insurance premiums in India can get expensive, here are some ways you can reduce the four-wheeler premium for your old car:

  • Claim NCB (No Claim Bonus):

A No Claim Bonus is a discount that insurance companies provide to their customers if they have not filed a claim during their policy tenure. This bonus acts as a reward from the insurance company for driving safely. It is an excellent way to reduce the premium amount. With each passing year that you do not file a claim, your NCB will keep increasing, thereby, reducing the amount you pay as premium for the policy.  

  • File claim responsibly:

An important thing about insurance policies is that you must know when to file a claim. For instance, if your car gets damaged and the damage repair cost is exceptionally minimal, then spend the money from your pocket to get the car fixed. Filing a claim for such small damages ruins the accumulated NCB, and you will not be able to enjoy the benefits from the bonus. 

  • Online policies:

Buying car insurance online has a lot of perks. When you buy the policy online, you can easily compare different plans and buy a suitable one. You can research different insurance providers and even use a four-wheeler online insurance premium calculator to lower the premiums with a car insurance calculator’s help. The calculator will provide you with car insurance quotes for other policies, helping you make an informed decision. An online car insurance premium calculator also aids in reducing the premium for your old car when you renew the car insurance online.

  • Voluntary deductibles:

A voluntary deductible means that you pay a percentage of the IDV amount towards the policy. By doing so, if your car gets involved in an accident, you will need to pay some portion of the IDV and the insurer will not pay the full amount. The responsibility of this payment ensures that the car owner drives carefully at all times, thus making one a safe driver. 

If you drive safely and take precautionary measures to avoid accidents, you will not have to pay the deductible and enjoy the benefit of lowered premiums.  

  • Choose third-party insurance:

A third-party insurance policy is a legal mandate for car owners on Indian roads. It is the bare minimum insurance policy that is compulsory for car owners. The premiums for the third-party policies are fixed by the IRDAI and will only depend on the car’s cubic capacity. Additionally, most insurance companies offer only third-party cover for cars older than 10 years. Thus, getting a third-party policy for your old car is a cheap option. 
However, remember that with the third-party insurance cover you will not be able to claim for the damages caused to the insured car. Hence, it is always advisable to go for a comprehensive car insurance policy wherever possible.

  • Renew policy on time:

Getting your policy renewed on time is extremely important. If you drive on the roads with an expired policy, then the fines you will have to pay will be high. Along with this, a failure to renew the policy on time will dissolve your accumulated NCB as well. You may lose out on the premium discounts, and if you renew your policy after it expires, the insurer will charge you more than you were paying before.  

  • Stick to one insurer:

The process of purchasing an insurance policy and renewing it at the same company will strengthen your relationship with the insurer. With this, you will be able to access loyalty programmes, preferential treatment and some discounts that the insurance provider may offer to its old and loyal customers. 

  • Ask about low-miles discounts:

A lot of insurers provide a low-miles or a pay-as-you-go discount on the premium amount. These discounts can be quite beneficial for those who do not use their vehicles frequently. As low miles mean a low probability of the car being involved in an accident, the insurer provides discounts to the policyholder.   

  • Get all policies from a single insurer:

You can choose to get all of your insurance policies under a single insurance company. This will strengthen your relationship with your company, and you will be able to benefit from the discounts available for long-term, existing or privileged customers. 

While most car owners may not feel the need to have a comprehensive four-wheeler insurance policy for an old car, it is better to buy one since the risk of a car being damaged is always present. And if you feel that you do not want to pay high premiums for an old car, you can make use of the tips mentioned above and protect your beloved car with four-wheeler insurance at affordable rates.

I am Finance Content Writer. I write Personal Finance, banking, investment, and insurance related content for top clients including Kotak Mahindra Bank, Edelweiss, ICICI BANK and IDFC FIRST Bank.