Why Your Motor Insurance Renewal Got More Expensive and How to Lower It

Have you recently opened your motor insurance renewal notice only to be hit with higher premiums? You’re not alone! Many vehicle owners in India are experiencing the same frustration, wondering why the cost of their policy keeps climbing. The good news is, understanding why this happens and knowing how to lower it can save you a lot of stress—and money! 

1. Why Your Motor Insurance Renewal is More Expensive 

Let’s break down the reasons behind the rising costs and discover some smart moves to keep your insurance expenses in check.  

● Regulatory Changes - The IRDAI periodically revises mandatory third-party insurance rates, leading to higher premiums when new rates are introduced. 

● More Claims, Higher Costs - With increasing road accidents, thefts, and natural disasters, insurers face more claims and raise premiums to cover the additional payouts. 

● Inflation & Repair Costs - Rising costs for vehicle repairs—due to inflation—drive up premiums as insurers adjust to higher labour and parts expenses. 

● New Car Technology - Expensive Fixes- Modern vehicles come with expensive tech like sensors and cameras, making repairs costlier and driving up insurance costs. 

● Add-ons & Extras - Choosing extra coverage like zero-depreciation or engine protection can enhance protection but also increases your overall premium. 

2. How to Lower Your Motor Insurance Premium: 10 tips and tricks 

1. Pick the Right Coverage: Ditch unnecessary add-ons if they don’t make sense for your vehicle. Keep only what you need and drop the rest. 

2. Stay Claim-Free for Discounts: Keeping a clean driving record can help you maintain your No-Claim Bonus (NCB) and score you big discounts—up to 50% after five claim-free years. 

3. Always Compare: Before renewing, it's essential to compare policies from different insurers. Many companies offer competitive premiums and discounts to attract new customers. Never settle for the first renewal quote you get. 

4. Install Safety Devices: Some insurers reward you for being smart about safety. Installing anti-theft devices or other car security systems could get you a discount on your premium, as it lowers the risk of theft. 

5. Consider Usage-Based Insurance: If you’re someone who doesn’t drive often, usage-based insurance might be perfect for you. These ‘Pay As You Drive’ insurances track how much you drive and adjust your premium accordingly, so if you’re not on the road much, you pay less. Drive less, save more!

6. Adhere to Traffic Rules: Obeying traffic rules reduces the likelihood of accidents, helping you maintain a clean driving record and potentially lower your insurance premium.

7. Be Safe and Responsible: Insurance companies reward safe drivers with lower premiums, as they pose less risk for accidents and claims.

8. Avoid Unauthorised Car Modifications: Car modifications can increase the value or alter the performance of your vehicle, leading insurers to charge higher premiums due to the higher cost of repairs or increased risk of accidents.

9. Don’t Raise Claims for Minor Damages: Filing claims for minor damages can lead to losing your No-Claim Bonus (NCB), which significantly increases premiums over time. 

10. Avoid Lapsed insurance policies: Renewing your policy within the grace period is crucial to prevent unnecessary complications. If you delay beyond this window, you'll need to purchase a new policy, which may trigger a vehicle reinspection. This process can increase the likelihood of a higher premium, adding to your overall costs. 

Conclusion 

By making a few strategic choices like reducing unnecessary add-ons, or comparing insurers, you can keep your costs in check while still protecting your vehicle. And if everything starts feeling too much, help is but a click away. Bima Seva Kendra is always there to assist you through insurance claim-related issues. 

So, the next time your motor insurance renewal lands in your inbox with a bigger price tag, you’ll know just what to do to lower it—without breaking a sweat.