How to Calculate Car Insurance Prices in India?

In India, car insurance is mandatory as per Section 146 of the Indian Motor Vehicles Act of 1988. An affordable four-wheeler insurance premium is one of the primary factors to choose the right four-wheeler insurance policy. Four-wheeler insurance calculators help estimate the price of insurance premiums for car owners and those looking to purchase a car. Let’s explore the factors that affect the car insurance premium, online premium calculation process and smart ways to save on your four-wheeler insurance premium in detail.

Everyone looks for a good four-wheeler insurance policy that fits their needs and wants. Using an online vehicle insurance premium calculator to choose the best possible coverage is crucial for making an informed decision.

Car Insurance Calculator Parameters

To calculate the premium of the car on insured declared value, there are three factors that are considered age, vehicle type and engine capacity. Let us look at how to calculate four-wheeler insurance.

Third-Party Liability Premium: It is based on the car capacity as well as the IRDAI (Insurance Regulatory Authority of India)

Own Damage Premium: If an own damage occurs, the insurance premium will be based on the Insured Declared Value (IDV). The higher the insured declared value the higher will be the premium. As time passes by, the car will get older and the insured declared value will also decrease. The premium is calculated by using the formula that is decided by the Indian Motor Tariff.

Insured Declared Value Estimated:

Insured Declared Value = Car price at showroom + accessories cost – value of depreciation of car, as per IRDAI

You can calculate the insurance premium of the car as following:

Premium Amount = Insured declared value x [premium rate fixed by the insurer + add-on] - discounts and benefits

Personal Accident Cover Premium: This cover will provide for accidents and in case of any unforeseen incidents leading to a disability. It is possible to increase the sum insured and that also includes other passengers in the policy. Although, for this cover, the premium can go higher with an increase in the sum assured.

 

Riders: The riders add-on provide an additional protection at a nominal cost. The insurer can select the rider based on their need and increase the coverage. Every rider will help to serve a different purpose and enhance the cover. Hence, the cost of the rider is offered to you by the insurance company

Factors that Affect the Price of Car Insurance

Here are some important things that affect the price of four-wheeler insurance premium are:

Vehicle Fuel Type

The premium for cars that run on compressed natural gas (CNG) is higher than the premium for cars that run on diesel or petrol.

Location Based

The place where the insured car will be driven most often is also taken into account when deciding the premium. For example, areas with a lot of traffic, like cities, will have higher premiums than rural areas or places with less traffic and less risk.

Insured Declared Value (IDV)

In the event of a total loss or theft, the Insured Declared Value is the highest amount an insurance company will pay out to the insured. The IDV relies on factors like the brand, manufacturer's selling price, model of the car, RTO details and so on.

Cubic Capacity

The cubic capacity of the vehicle also influences the car insurance premium. A four-wheeler insurance premium is also affected by the car's make, model and type.

Year of Manufacture

Old cars will have low IDV values due to the depreciation factor, which means that their insurance premiums will be less than those for newer cars, whose IDV values are higher.

No Claim Bonus (NCB)

When no claims were made over the duration of the specified policy, the insured can get the advantage of the No Claim Bonus during their policy renewal. It is advisable to renew your four-wheeler insurance policy on time to avoid losing NCB.

How to Save on Your Shriram Car Insurance Premium

Renew your insurance on time

When an insured missed their four-wheeler insurance policy renewal, No Claim Bonus resets to zero. It means that the accumulated No Claim Bonus gets expired as a consequence of not renewing the Comprehensive Plan within 90 days of the policy's expiration date, and your NCB will be reset to zero. Renewing your four-wheeler insurance on time can help you save money.

Anti-theft devices - ARAI

Anti-theft devices that have been authorised by the Automotive Research Association of India (ARAI) can benefit an individual to get a competitive premium.

Wrapping Up

A wide range of factors influences the cost of a four-wheeler insurance policy. An individual can get an online quote for Shriram Car Insurance on the go by giving a few necessary information about their vehicle.

Shriram Car Insurance provides comprehensive coverage and all-around protection for your car. The coverage can pay for covered damages or losses caused by a variety of incidents. Additional coverage can be added to the insurance policy to give greater protection for the vehicle.

FAQ’s

How much does car insurance cost in India?

Four-wheeler insurance premiums differ based on the type of coverage you decide. Your premium will be calculated by an insurance provider depending on your vehicle’s age, location, the kind of coverage you need (e.g., third-party or own damage)

How does the IDV of a car reduce with age?

In car insurance, an IDV (Insured Declared Value) is the current market value of your vehicle. IDV also assists us in determining the appropriate premium price for your four-wheeler insurance.

What is bumper-to-bumper insurance?

Bumper-to-bumper four-wheeler insurance also known as full-body insurance covers all rubber, fibre and metal parts of your car without considering the depreciation value.

 

Key Highlights

• A car insurance calculator assists car owners and people who want to buy cars figure out how much their insurance premiums will be when they purchase the right policy online.
• The cubic capacity of the vehicle also influences the car insurance premium. A car's insurance premium is also affected by the car's make, model and type.
• Bumper-to-bumper four-wheeler insurance, also known as full-body insurance, covers all rubber, fibre and metal parts of your car without considering the depreciation value.
• Shriram Car Insurance provides comprehensive coverage and all-around protection for your car.