It is important to take car insurance, whether you are taking only basic liability or full coverage. But this does not mean that you pay more premium without any reason. If you do a little smart planning, then your car insurance premium can be reduced considerably.
So let’s go, today we will discuss 5 ways that can help in reducing the cost of your car insurance premium.
How to Save Money on Car Insurance Premiums?
1. Avoid Small Claims
If you do not claim for small damages, then the insurance company gives you No Claim Bonus (NCB). This is a reward that can give you up to 20% discount on your next year’s premium. If you go through multiple years without any claim, the discount can increase even more.
But if you start claiming for every small damage, the NCB benefit will be lost. So, claim only for big expenses and pay for small damages yourself.
2. Avoid Extra Modifications
If you are making unnecessary modifications to your car, like alloy wheels, high-end music systems, or fancy lights, your premium will also increase. Because insurance companies have to cover extra risk.
Apart from this, if you make your car too flashy, it can also become a new target for car thieves. For this reason, insurance companies increase the premium. So if you want to save money, avoid unnecessary modifications.
Also Check: How to Choose the Right Car Insurance Policy? Complete Guide (2025)
3. Use Car Insurance Premium Calculator
Using a car insurance premium calculator can be a smart move. This tool gives you an exact idea of how much your premium will be if you buy a specific policy.
In this calculator, you just have to enter your car model, RTO location, previous claim details, and some other basic information. This helps you compare which plan is best for your budget and needs.
4. Increase the Deductible
Deductible means that if you make an insurance claim, you have to pay a fixed amount yourself. If you choose a higher deductible, your premium will be reduced.
For example, if your deductible is Rs. 5000 and you claim Rs. 20,000, you will have to pay the first Rs. 5000 yourself, and the remaining Rs. 15,000 will be given by the insurance company. Choose this option only when you can cover this amount in an emergency.
5. Drive Safely
If you improve your driving habits, you can also reduce your insurance premium. Follow traffic rules, don’t overspeed, and avoid avoidable accidents.
Insurance companies check your driving history. If you have traffic violations and fines on your record, your premium also increases. So, safe driving is important not only for your safety but also for your budget.
Also Check: What is Third-Party Car Insurance: Why Are Indians So Stressed About It? (2025)
Bonus Tips:
1. Review Collision and Comprehensive Coverage
If your car is old, it may not be necessary to get collision and comprehensive coverage. When the value of your car goes down, it makes no sense to spend more on insurance.
2. Take a Defensive Driving Course
Some insurance companies provide safe driving courses which can give you a discount on the premium. These courses are usually available online and their cost is also very low.
3. Compare Insurance Plans
You should always compare different insurance policies. You can get the best deal by comparing the premiums and benefits of different companies.
4. Install Anti-Theft Devices
If you install anti-theft devices in your car like GPS tracker, steering lock, immobilizer, then insurance companies can give you discounts because the risk of theft of your car is reduced.
5. Pay Attention to Annual Mileage
If you drive less throughout the year, then your premium can also be affected. Some insurance companies give discounts to such drivers who drive 10,000 miles or less.
Conclusion
Reducing car insurance premium is not difficult, it just requires a little smart planning and research. If you avoid unnecessary claims, do not make modifications, use the premium calculator, increase the deductible, and drive safely, you can save a lot of money.
If you are looking for an affordable and hassle-free car insurance plan, Tata Capital can be a good option. It gives you the option to purchase policies online, which saves you from extra charges by agents.
So review your insurance policy today and invest your hard-earned money in the right place!
