ways to reduce premium for car insurance

Here discussed are some ways that will help you bring down your car insurance premium. The no-claim bonus magnifies with every additional consecutive year of no-claim record.

If the premium that you pay towards your car insurance pinches your pocket there are ways you can bring down this liability. You do not actually have to compromise on the coverage too much, rather you need to be just a bit discreet about what you are buying and also be aware of the various options that you have in hand. Here are some ways that will help you bring down your car insurance premium:

1) Avoid making minor claims in favour of No-claim bonus

You do not have to really rush for a claim for the most insignificant damage that has happened to you car. In case of minor claims you might end up spending more than you save. So if you need to make a claim at the cost of losing a no-claim bonus be sure that the amount of claim that the insurance company would reimburse you for is significantly higher than the potential no-claim bonus you can get for not making the claim. The no-claim bonus magnifies with every additional consecutive year of no-claim record.

2) Voluntary Deductible

Quite a few people in order to save money on insurance tend to cut down on coverage. A better way to deal with the situation is to opt for a voluntary deductible in addition to the compulsory deductible. Compulsory deductible is the minimum amount of money that the insured has to pay out of pocket in case he makes a claim. By opting for a voluntary deductible you agree to pay a higher sum out of pocket in case you make a claim. The insurance company compensates you for this by lowering your premium. You can expect to cut down on you insurance premium by 20 to 30 percent. Those people who are quite confident about their driving should go for a voluntary deductible.

3) Compare before you buy

The insurance business is competitive and there are many insurance companies offering car insurance. The price of motor insurance is likely to vary from one company to another and it is advised that you make an online comparison. This will help you spot the best car insurance that fits your needs as well as budget.

4) Know if you are eligible for discount

You can look to save a few hundred rupees on your insurance policy if you have installed anti-theft device in your car. If you qualify as a “safe driver” you can earn an incremental discount of about Rs 200. To be recognized as a “safe driver” you can become a member of the Automobile Association of India.

5) Cut down on policy coverage that seems redundant or avoidable

If you already own personal accident policy separately and your car insurance as well includes the same as part of the coverage it is best that you ask the insurance company to offer you a policy that does not include personal accident coverage.

what is a voluntary deductible option

You can save spending more money in the form of periodical premiums for your vehicle based on your driving skills. One of the ways is voluntary deductible option. It is the minimum amount that is declared by the policyholder for bearing the expense at the time of claim.


If you have planned to purchase a new car, then it is vital to know which car insurance suits you the most. When you opt for cheap car insurance, it prevents you from getting cash-strapped in the event of a mishap. These days more and more car owners have started showing interest in car insurance policies. Today, the situation is such that owners are comparing different car insurance premium quotes from various insurance companies before making their choice. This attitude of owners plays a major role in reducing the money spent for car insurance premium. Are you one of them? If yes, then you can hit upon several attractive offers as well.

What you need to know about Voluntary deductibles

You can save spending more money in the form of periodical premiums for your vehicle based on your driving skills. One of the ways is voluntary deductible option. Are you wondering what it is? It is the minimum amount that is declared by the policyholder for bearing the expense at the time of claim. Premium and deductible are inversely related. The less premium you pay more is the deductible in the event of a claim, and those who believe they have good driving skills can use this to save on premium and reduce the risk of accidents.

How voluntary deductible works:

In case you have a claim amount of Rs 10,000. Let’s say Rs 500 is the mandatory deductible and you have declared the voluntary deductible amount as Rs 1,500, then you have to pay Rs 2,000 initially. Rest of the amount i.e. Rs 8,000 will be payable by the insurance company. If you hadn’t opted for the additional voluntary deductible of Rs 1,500, you would have paid extra money through premium. Those who risk the incident of a claim less can use this inverse relation to their advantage.

The insurance premium is never a fixed amount. It keeps changing with every insurance company. In fact, it is advisable to first make a good comparison of the prices of various companies before taking the final decision.

The levels of discounts that you get with voluntary deductible option

Usually, the insurance companies offer you four different levels of discounts. Let’s say the least amount of voluntary deductible that you can offer to pay is  2,000, in addition to a compulsory deductible of Rs 1,000. When you opt for a claim of say Rs 25,000, you are supposed to make this combined payment of Rs 3,000. This payment will be considered as a part of the claimed amount. The insurance company will pay the remaining portion of the claimed amount for you. If you are a policyholder, let us say you get a discount of Rs 750 for this choice of voluntary deductible.

Policyholders may be able to choose payment levels starting from Rs 2,000. The highest voluntary deductible a policyholder can make is Rs 20,000, and the discount for this is Rs 10,000. By taking a chance on Rs 2,000 and Rs 20,000, you can save Rs 750 and Rs 10,000, respectively. This could be a fair deal depending on the driving skills of a policyholder and his or her confidence. Hence, there is no denying that voluntary deductibles play a major role in reducing your car insurance.