Car Insurance costs vary greatly with the IDV and other parameters of the car. Simply put, it is determined by each insurance provider in their own way. Car insurance costs also reflects their past experiences of a certain segment, or customer group, etc. So its better to compare 3 – 4 car insurance costs quotes for getting the best insurance quotation possible. However, you need to ensure that the insurer does not reduce the valuation of your vehicle (known as IDV) to reduce premium and car insurance costs, as it is counter-productive. Same is the case with deductibles and coverage amount. Lowering these parameters, to give you a lower premium amount, may adversely impact you when you go for a claim.
Some of the parameters determining the car insurance costs are:
- Your car value as per the insurance company database. – This is typically based on their past experience and Industry benchmarks. There could be certain cars which are in the negative category. For these set of cars, a typical insurance company might not offer Insurance.
- Last IDV (Insured Declared Value) . This can be seen from your last policy statement. If you have a lower then normal IDV in any particular year, it will impact all subsequent years valuation, as the new IDV has to be a certain % below the last year IDV.
- Your age, profession. : This is customer profiling, this shows them the likelihood of a person with a certain background presenting a claim. A person with higher likelihood for claim can possibly get a higher premium amount.
- City where the car is registered (not where it is being used).: This indicates the final value of the Car, including road tax and other details. This might also be used for historic data matching.
- Past claims. : Simple enough, if there are too many previous claims, the insurance company can also decide not to offer you and insurance.
- Model/make and year of manufacture of the car. : This helps in determining the true value of the vehicle. For example, they would know how much does a Mahindra XUV be worth after 2 years, with or without past insurance claims.
Based on these and some other smaller components, the car insurance costs will get calculated.
If you need any assistance in selecting the best insurance for your vehicle, please fill in the form above and get the best insurance quote.