Renewing your car insurance is like giving your vehicle a shield of protection. Yet, many overlook the nuances of this process, leading to missed opportunities and potential legal issues. While renewing your car insurance can seem like just another task on your to-do list, this process is more than a formality; it’s a crucial step in maintaining your financial security and abiding by the law.
Mr. Rakesh Goyal, Director at Probus Insurance Broker, sheds light on the pivotal aspects of car insurance renewal and the common pitfalls to avoid. Here are some common pitfalls to avoid, ensuring your car insurance renewal process is smooth and effective.
Don’t Miss the Payment Deadline
Car insurance policies are typically short-term, lasting 1-3 years, making it easy to overlook premium payments. “Motor insurance has two components: third-party and own damage. Not paying premiums on time will lead to breaching the law and not getting any claims if the policy lapses,” warns Mr. Goyal. To stay covered and legal, mark your calendar and set reminders for your payment due dates.
Compare Before You Commit
Many policyholders make the mistake of renewing their insurance without shopping around. Goyal advises, “Before buying a policy, you shouldn’t skip looking at and comparing the features of a few others.” With the help of web aggregators, comparing policies has never been easier. This ensures you get the best deal in terms of coverage, limitations, and price.
Select the Right IDV
The Insured Declared Value (IDV) significantly impacts your premium. Setting it too high or too low can be a costly mistake. “Maintain an IDV balance. A higher IDV increases the premium, while a lower IDV decreases it but also reduces coverage,” explains Goyal. Finding a middle ground is key to getting the coverage you need at a fair price.
Choose Add-Ons Wisely
Add-ons enhance your policy but at an extra cost. “Purchasing the right add-ons is crucial. Assess your insurance needs carefully before making any additions,” Goyal suggests. While some, like zero-depreciation for new cars, can be incredibly beneficial, adding too many can inflate your premium unnecessarily. Conversely, skimping on add-ons can leave you underinsured.
Be Honest and Accurate
Providing false information when applying or renewing your car insurance is not only illegal but can lead to claim rejections. “The foundation of insurance is trust. Always provide accurate information,” Goyal emphasises. This honesty ensures that the insurer can provide the coverage that accurately reflects your situation and needs.
Don’t Overlook the NCB
The No-Claim Bonus (NCB) is a reward for claim-free years, reducing the renewal premium. “If you haven’t made any claims in the past year, you’re eligible for a discount on your renewal. Make sure to claim your NCB,” advises Goyal. This bonus can significantly lower your insurance costs over time, so don’t forget to factor it in when renewing.
Renewing your car insurance isn’t just a legal requirement; it’s an opportunity to review and adjust your coverage to match your current needs. By avoiding these common mistakes and taking heed of expert advice from industry professionals like Rakesh Goyal, you can ensure that you remain adequately protected on the road without paying more than you need to.
Remember, a little effort in the renewal process can lead to substantial savings and peace of mind.
Edited by Roshni Manghnani
