Pros & Cons of Staying with the Same Car Insurance

According to the Indian Motor Tariff Act, automobile insurance is required for all car owners in India. It not only allows you to drive on the road but also protects you from financial liabilities incurred by a third party, as well as damages and losses to your vehicle. A third-party auto insurance policy will protect you against damage caused by a third party, while a comprehensive policy will safeguard you from harm caused by your vehicle. Car insurance policies typically last one year and must be renewed after that. The policyholder's prerogative is to keep the same coverage or look for a new one. There are numerous advantages to sticking with the same insurance plan for a long time, such as insurance company loyalty perks and rewards. However, there are some disadvantages attached to it too. When one studies and performs a comparison, it is discovered that a lot is being missed. Let's look at some of the benefits and drawbacks of dealing only with a single insurance company for a long time.

Pros of staying with the same insurer

• Years of service leads to a trusted relationship

Developing a trusting connection with your insurance provider can take a long time. After all, your insurance company has gained your confidence by protecting you and your vehicle for many years, and it might take a long time to gain similar faith with a new insurer.

This trust comes in handy when the policyholder is in a bad position, such as when the car breaks down or, even worse, when he is involved in an accident, and things get nasty. A seasoned insurer will be more familiar with policyholders' driving patterns and claim history, allowing them to comprehend the scenario better in case of unforeseen circumstances.

• Reduced deductibles

Many insurance companies may give a discount if the policy-holder stays with them for a long time (especially if they involve several claim-free years). They may be able to reduce the deductibles or maybe waive them entirely.

Deductibles are the amounts one must pay out of pocket in the event of a claim before the insurance company reimburses them. Voluntary and mandatory deductibles are the two types of deductibles. The mandatory deductible has no bearing on the premium. However, it is still beneficial because one may not have to pay any money if involved in an accident.

• Accident Forgiveness

Accident forgiveness is a perk available to loyal policyholders who have a clean driving record. In other words, the insurer will "forgive" or disregard your first at-fault collision. As a result, the insurance rate will not increase because the accident will not be recorded in their records. If one switches insurance providers, accident forgiveness cannot be transferred to a new provider, unlike a No Claim Bonus.

• No hidden costs

When one stays with an insurance provider for a long time, one gets to learn about all the terms and conditions of the policy. This safeguards the policyholder from inviting any additional costs or charges once a claim is raised. Also, switching insurance providers may result in additional charges, which may enhance the premium, and some hidden charges may also appear when a claim is filed.

• Easy Renewals

To renew a car insurance policy with the current insurer, all one has to do is go to their website, submit the policy number, and pay the annual charges. However, if one chooses to change insurers, complete vehicle details would be needed to get a new policy. Examination of the vehicle might also be required while renewing the existing policy with a new insurer, which is a common practice.

Cons of staying with the same insurer

We have studied the positives of being a loyal customer to the insurance company, and there is no denying that it is both comfortable and convenient. Still, then every coin has a flip side; if one does not pay attention, there are many services and offers one might lose out. Let�s look at some of the drawbacks of continuing with the same insurer year and year on.

• Losing out on extra add-ons

Many add-on covers, including roadside assistance, co-passenger coverage, and zero depreciation coverage, may be available with a comprehensive plan from the current insurance provider. On the other hand, other insurers may offer a far larger selection of add-on coverage. Although these could increase the cost, they will come with more extensive car coverage.

• Missing the discounts on Offer

When users renew the same auto insurance policy they have had for a long time, the benefits remain essentially the same. But, if other options are explored, one might be able to locate a policy that provides even better coverage at a lower cost. Furthermore, several insurers offer special deals to new customers, substantially reducing the premium.

• Insufficient coverage

When the coverage is renewed, it's critical to go through the policy document and double-check what is and isn't covered. It will allow assessing if the current plan is still adequate. This is especially true if one has purchased a new automobile. Maybe it is an excellent time to reassess the coverage at this point and see if switching insurers might be of benefit.

• Better Service

One may discover that different insurance provides significantly more significant service benefits in some cases. With some insurers, the claims process is entirely electronic and paperless.

These steps may include a lot of paperwork and possibly even a physical surveyor with many traditional insurance firms.

Conclusion

Based on the above discussion points, make up your mind and If No Claim Bonus is the cause for concern, take a deep breath and relax. Don't let the possibility of losing the No Claims Bonus deter you from switching insurers that can be easily changed to the new insurer. If you believe it is the better alternative, you can make a straightforward transition to another insurance company. Third-party insurance for vehicles traveling on Indian roadways is required by law. Purchase third-party auto insurance and stay covered. If the car gets involved in an accident, avoid being responsible for the costs of damage restoration, which can be costly.