Having a car is a necessity as it saves you from unnecessary expenses. In fact, studies show that the average man spends 10-15% of his income on transportation expenses if he doesn’t own a car.
If you own a car, then you need insurance because it will help with finances, especially if there is an accident that results in death, and also stops a lawsuit from being filed against you even if you are the one at fault. In essence, car insurance covers the bills of repair in the case of any damage no matter whose fault it is. Insurance is simply what people buy to protect them from losing money if something bad happens.
When buying car insurance, you should consider different insurance policies before finally settling on a particular one. You should also remember that car insurance is to be renewed on a yearly basis, and also as early as possible to avoid unexpected car damages and expenses except it is automatic insurance. As an insurance policyholder, sometimes you can forget to renew your insurance due to certain reasons but as long as you renew it before the expiry date then that will save you a lot of stress. These are 10 smart tips to follow when you want to renew your car insurance;
With a car insurance comparison, you can save up to several hundred euros a year in contributions. Best of all, the comparison is easy, fast and free.
What is car insurance?
As car insurance, we commonly refer to different types of insurance around motor vehicles. This includes, for example, insurance for the car or for motorcycles.
The best-known type is liability insurance, as this is legally mandatory for every owner of a motor vehicle. Motor vehicle liability covers accident damage of the other parties involved in the accident if you cause an accident yourself. Included are personal injury, property damage and financial loss.
On the other hand, comprehensive insurance covers damage to your own vehicle. Here we divide into partial comprehensive and fully comprehensive insurance, which differ in the scope of services. The partial comprehensive insurance covers vehicle damage caused by fire, explosion, theft, storm or collision with wild animals. In addition to the partial comprehensive services, the fully comprehensive insurance covers damage to one’s own vehicle due to vandalism or personal fault. Comprehensive insurance is not mandatory, but it is especially useful for new or valuable cars.
- Motor vehicle liability for the protection of persons, property damage and financial losses
- Partial comprehensive insurance: Covers damage to your own vehicle (through no fault of your own)
- Fully comprehensive insurance: Partial comprehensive protection + vehicle damage due to personal fault
1. Be aware of different car insurance companies and look out for discounts.
It is very necessary to check and compare different car insurance companies and policies before deciding on one because the only way you can save money is by comparing prices since there is huge competition between different insurance companies.
When comparing, you should check the terms of coverage, that has a good plan, look for discounts because discounts help you save a lot of money, good reviews by customers and also that has a mobile app and operates online too just in case you decide to pay online.
2. Decide on the type of plan
There are different types of plans. There is the Third-party policy plan and also the Comprehensive plan.
The third-party plan is cheaper, but offers just a little coverage for your damages and protects you only against third party damage while the comprehensive plan offers a large coverage and protects you against any type of damages like fire, accident, theft, including third party damage.
The comprehensive plan is usually a smarter and better choice if you don’t want to spend a lot. If you decide on a good insurance plan, it will not only help you in saving money but also give you different added benefits.
3. Choose Add-Ons;
Add-ons are additional coverage that a car owner buys to help strengthen the financial security of his car. There are different add-ons like passenger cover, Engine protection cover, Roadside cover.
Engine protection cover is very necessary when renewing your car insurance, especially if you are residing or making use of roads situated in water-logged areas. When choosing add-ons, check which one benefits you more and don’t choose unnecessary ones.
4. IDV (Insurance Declared Value)
This is the amount your insurer will pay you if your car is seriously damaged or stolen. When renewing your insurance, you can be asked to pay a higher amount to increase your IDV especially if the value of your car has depreciated. IDV is very important in renewing your car insurance as it is the main aspect of car insurance.
5. NBC (No Bonus Claim);
NBC is an important tip to remember when renewing your car insurance. NCB applies to the owner of the car and not the car itself. It is a 20-50% discount an insurance company gives to a car owner on his insurance if he has never had any damage claim to the car. If there is more than one damage claim during the insurance policy, then the NCB of the car owner goes back to zero.
6. Check the insurance company claim history
The claim history of an insurer helps you decide if you should buy the policy or not. Every car owner wants a quick procedure when it comes to renewing his car insurance.
The no-claims discount or the no-claims class is a waiver on the basic premium of the car insurance, which is based on the number of damage-free insurance years. It is part of all tariffs with the exception of partial comprehensive insurance.
In the event of a change of insurer, the no-claims class is taken over by the new insurer, but the amount of the discount may change slightly. In general, the longer you drive accident-free, the higher the discount. A downgrade only takes place in the event of damage.
7. Go for deductibles
Some insurers allow you to pay part of the money during a claim. Deductibles are the amount you pay before your own insurance plan starts to pay, the amount you pay when you file a claim under an insurance company’s policy. Remember, if the amount for repairs is less than your deductibles then you should not file for a claim.
Partial or fully comprehensive insurance provides optional protection to your mandatory car insurance. Especially for new cars, valuable motor vehicles, cars financed by credit or leasing vehicles, fully comprehensive insurance makes sense.
If your car is older than 5 years and has at least a medium financial value, you should take out partial comprehensive insurance. Further decision-making aids for partial or fully comprehensive insurance are your personal insurance needs as well as your own driving habits.
In the case of a car on which major repairs for damage would no longer be worthwhile, you should cancel the hull. However, if you shut down the hull for more than half a year, you must expect a new no-claims class when it is resumed. It is common for car insurance to deduct one class per suspended year.
8. Install security devices;
Installing security devices in your car is a very important tip during car insurance renewal and is a good step to safekeeping your car. Although installing security devices increases your car security, it also reduces the insurance premium price. Before installing security devices, check out with your insurer because you need to be careful about the type of devices you install. Also, check for security devices with discounts when choosing one.
9. Be a member of any automobile association.
Being a member of any automobile association helps with discounts especially if you are renewing your insurance online.
Don’t forget to renew your insurance on time
In fact, I think this is supposed to be the number one tip when renewing your insurance. Remember a stitch in time saves nine so it is important to renew your insurance on time because it helps reduce your insurance premiums. If you renew your insurance at a later date future prices increase. Also renewing on time helps secure your car especially in the case of sudden damages.
In conclusion, a car insurance renewal is beneficial to both the insurer and the car owner. It is important to go through the company’s policy before renewing instead of relying on the old policies because most insurance companies change some of their policies every year and it might not be suitable for you.
You have to be attentive to the renewal of the policy and talk to the company. First, to find out the renewal price and, second, to see what improvements they have included in the policy, especially if the price of it goes up.
In addition, it is important that you review which of the current coverages you are still interested in and if you need any new ones, as well as updating others, for example, increasing insured capital.
And if you find something better, do not hesitate to contact your company or insurance mediator to inform you that there are those who offer you better conditions. On many occasions, you will get, at least, that they match the offer, even that they improve it.