does car insurance claim increase premium
By Okbima 11 Jun 2024

Does Car Insurance Claim Increase Premium?

 

Yes, filing a car insurance claim in India can increase premiums. This is because insurance companies consider claim history when calculating premiums, and a history of frequent claims can be seen as a higher risk factor for the insured. 

As a result, the insurance company may increase the premium to reflect the increased risk. However, the specific impact on premiums will vary depending on the individual's claims history and the terms of their insurance policy.

 

Impact Of Claim On Premiums On Car Insurance

The impact of claims on car insurance premiums can vary based on many factors, including the insurance company's policies, the type and frequency of claims, and your circumstances.

  • Type of Claim: Insurance companies differentiate between at-fault and not-at-fault claims. At-fault claims, where you are responsible for the accident, typically have a higher impact on your premiums compared to not-at-fault claims.

  • Frequency of Claims: If you have a history of frequent claims, regardless of fault, insurance companies may view you as a higher risk to insure. This could cause higher premiums or even difficulty in getting coverage.

  • Insurance Company Policies: Different insurance companies have different guidelines. Some may be more forgiving of certain types of claims or offer accident forgiveness programs that prevent your rates from increasing after your first at-fault accident.

  • Individual Circumstances: Your personal driving history, including any traffic violations or previous claims, as well as demographic factors like age, location, and the type of vehicle insured, can be the factor of how much of an impact a claim will have on your premiums.

  • Coverage Limits: The coverage limits you choose for your policy can also affect the impact of a claim. Getting higher deductibles or lower coverage limits may cause lower premiums but could also mean higher costs in the event of a claim.

 

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Factors That Determine Premium Increases For Car Insurance

Some factors determine the premium for your car insurance such as the age of the driver, driving history, type of vehicle, location, coverage options, etc.

  • Age of the driver: Younger drivers (under 25) and older drivers (over 70) are considered higher-risk drivers, and may face higher premiums compared to middle-aged drivers.

  • Driving history: Drivers with a history of accidents, traffic violations, or claims can have higher premiums as they are considered to be higher risk.

  • Type of vehicle: The make, model, and age of the vehicle can also impact the premium. Luxury or high-performance vehicles are more expensive to insure.

  • Location: The area where the vehicle is registered can also affect the premium. Areas with higher rates of theft, or accidents may cause higher premiums.

  • Coverage options: The type and level of coverage chosen by the policyholder can also impact the premium. Comprehensive coverage with higher limits will cause higher premiums.

  • No-claim bonus: Policyholders who have not made any claims in a certain time are eligible for a no-claim bonus, which can help lower the premium.

  • Deductible amount: Getting a higher deductible amount can lower the premium, as the policyholder agrees to pay a larger portion of the claim amount themselves.

  • Insurance company: Different insurance companies have different pricing strategies and may offer discounts or incentives that can affect the premium.

  • Type of coverage: Third-party liability coverage is required by law, while comprehensive coverage is optional. Choosing comprehensive coverage will increase the premium.

  

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Ways To Reduce Car Insurance Premium

Below, we have mentioned some ways to reduce car insurance premiums such as comparing quotes from multiple insurance companies, driving safely, getting a lower coverage, etc.

  • Compare quotes from multiple insurance companies: By comparing quotes from different insurers, you can find the best policy for your needs at the lowest price.

  • Drive safely: Maintaining a clean driving record can help lower your car insurance premium. To be eligible for discounts, it is important to prevent accidents and follow traffic rules.

  • Install anti-theft devices: Installing anti-theft devices in your car can reduce the risk of theft, which can cause lower insurance premiums.

  • Get a lower coverage: If you have an older car that is not worth much, consider opting for a lower coverage to reduce your premium.

  • Bundle policies: If you have multiple insurance policies, such as car and home insurance, consider bundling them together with the same insurer to get a discount.

  • Avoid small claims: Making small claims can cause higher premiums. Consider paying for minor repairs out of pocket to avoid unnecessary or small claims.

 

Read More:

New Traffic Rules & Fines India: Without Licence Fine, RTO Fines & More

Vehicle Fitness Certificate Download From Parivahan

How To Claim Car Insurance? Own & Bumper Damage & After Accident

Best Car Insurance Policy in India 2024

Top 10 Car Insurance Companies in India 2024

 

Conclusion

In conclusion, filing a car insurance claim in India can raise your premiums. Insurance companies consider your claim history, type of claim, coverage, age, driving record & other factors. To pay less, compare quotes, drive safely, use anti-theft devices, choose lower coverage, bundle policies, maintain a good credit score & avoid unnecessary claims. Prioritize lowering costs while ensuring coverage. For any assistance, you can contact “Our Experts”.

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