Although it is legally mandatory, having an auto insurance plan for your vehicles does indeed eliminate a lot of financial burden or stress. The financial protection it offers against any loss or damage not only keeps your finances in check, but also ensures stress-free driving at all times. The auto insurance premium is an essential factor to keep in mind when purchasing / renewing a insurance plan. They can weigh down your pocket due to some aspects that need to be taken into account. Here are some of these aspects.
The make, model and variant of your car
It is a known fact that the premiums for a luxury car or sports car like a sedan would be much higher than for a sedan. Since these expensive cars have a high maintenance cost, they charge a higher premium amount for their insurance plan. The fuel variant also plays a role in any kind of compensation. A diesel variant car would have a higher premium over a gasoline / CNG model. Therefore, the elemental makeup, type and even the displacement of your car’s engine are factors that contribute to the amount of the premium. Making sure the policy is affordable with the most suitable add-ons for your vehicle is one of the most important decisions you make when buying a car.
Vehicle age and insurance area
The age of your car and where you get your car insured are two additional factors that determine the premium amount for your car. The age of the vehicle corresponds to two essential interdependent notions, namely the Depreciation and the Assured Declared Value (VDI). Depreciation refers to the reduction in the value of your car due to natural wear and tear over time. In contrast, the IDV is the approximate current market value of the vehicle. It will cost less to insure an older vehicle and more for a new car due to the aforementioned concepts.
The auto insurance of a metropolitan city will be higher than that of a Level 2 or Level 3 city, as the frequency of accidents or damage tends to be higher in subways due to heavy traffic and congested roads. Compared to the quiet, easy-going life on non-subways, subways are more likely to claim repairs in a fast-paced environment.
Other factors that play a role in determining the premium amount are type of coverage, availability of add-ons, anti-theft devices / security features, loss-free bonus, experience of the car owner, the frequency of claims and voluntary deductibles.
Therefore, when purchasing / renewing an auto insurance policy, keeping the above aspects in mind, compare auto insurance online quotes and supplements provided by several insurers and finally choose the insurance policy best suited to your needs. Make a wise decision because, after all, a penny saved is a penny earned.