Did You Know That Your Car Type Affects Your Premium? Find Out How!

Car owners in India must acquire insurance for car in order to operate them on public highways legally, but the insurance market is growing increasingly complex. The amount of an individual’s monthly car insurance premium is based on several factors, such as the individual’s driving history, the availability of advanced anti-theft systems in the vehicle, the age of the driver, its voluntary deductibles, and so on.

The fact that this type of car also has an impact on the amount of the insurance premium is something that makes car owners alert. Insurance prices go up proportionally with the value of the vehicle being insured.

How does the car’s brand affect its insurance premium?

Some cars are expensive to insure, and there is a strong relationship between the car type and the premium cost, with both factors being directly proportional to one another. Hatchbacks, sedans, and sports utility vehicles are India’s three most common types of cars. The hatchback is less expensive than the sedan and SUV and affordable to insure.

The following are some reasons why vehicle insurance online premiums are based on the type of vehicle:

  1. Vehicle make and model:

The make of the car corresponds to its brand and manufacturer’s name, while the model of the car refers to the vehicle’s specific label. Another entity used to refer to the car is its version or variant, the brand used to identify the car.

Insurance premiums can differ for each variant of the same car model from the same manufacturer. Despite the premium being for a new vehicle or an existing car insurance renewal online or offline. This is because each variant is unique and has expensive parts than its counter variants.

If the vehicle has advanced features and specifications, the insurance cost can be higher because these vehicles are expensive to repair, and their parts are challenging to replace. In case of an incident or damage, the additional cost of repairing these vehicles and replacing their parts shall be covered by the car insurance company in the form of higher premiums.

  1. Fuel type:

The cost of car insurance can also vary depending on the type of fuel used, such as petrol, diesel, CNG, LPG, or an electric engine. The compensation also varies depending on whether the CNG kit is installed internally or externally.

  1. Cubic capacity of the engine:

Different car models have various cubic capacity engines, which has a direct impact on car insurance premiums, for both new car insurance and car insurance renewal online or offline, for an existing vehicle. Premiums can be higher for vehicles with larger engine capacities. Similarly, the car’s age influences the premium, as it influences the insured declared value of the vehicle. Premiums for used cars can be lower than those for new cars.

In conclusion:

In India, repairing and maintaining a nice car is simple; nonetheless, the owner of such a vehicle would be asked to pay higher insurance for car premiums. However, having such high-end variations can be a source of pride and self-satisfaction for the owner, if they are aesthetically pleasing to the owner.

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** Currently, there are 2 tax regimes in India – new and old. To get the tax benefit you desire, choose the correct one after consulting an expert. You can opt for a regime change during the next financial year.

# Visit the official website of IRDAI for further details.

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