Always a great amount no matter how cheap your car is in terms of cost. Became a mandatory requirement (the Motor Vehicle Act mandates cover car insurance), costs can not be avoided. Therefore, with a heavy heart that we part with our money when buying or renewing our car insurance plan. It is possible to adjust the amount of your car insurance policy premium up to a certain limit. The idea is to not lose coverage in the future of the race reducing premium costs for now. Step 1 – Determine the optimal Insured Declared Value (IDV) of your car.
The IDV your car is valid maximum Sum Assured of your car insurance plan. This is the amount (calculated as the market price of the car less depreciation) are paid to you if your car is stolen or your car is damaged beyond repair.
As is obvious, the premium rate is determined at IDV quoted. The IDV varies and so does the insurance premium rate. Option to choose IDV is solely on you. IDV selected must be optimal. Too high and you do not have to pay higher premiums, too low and you get a small claims. A balance must be achieved and optimal levels of IDV must be selected.
To select the optimal IDV, you can reduce the depreciation rate standardized by IRDA from the market price of the car.
Age level vehicle depreciation
Less than 6 months 5%
6 months to 1 year 15%
1-2 years 20%
2-3 years 30%
3-4 years 40%
4-5 years 50%
Assess your IDV according to the age of your car and settled at optimum levels.
Step 2 – Consider the available coverage.
Once you have identified IDV, see the coverage provided by the various plans. Usually a comprehensive policy coverage has two parts – the cover third-party and own damage cover. Also, there may be riders available that allow you to adjust your plan and increase coverage. Special consideration should be given to riders such as adding them would increase the incidence of premium.