Guide To Getting The Best Car Insurance

Posted Date: Fri Jul 2016

If you’re reading this article then surely your search has culminated into the firm decision of acquiring an insurance plan for your vehicle whether it’s newly purchased or currently in use. This write-up shall act as a guide to help you consider the factors that can play a pivotal role in how your insurance plan shapes up and the accompanying cost it carries and these factors will drive a balance between how much your policy costs you as well as the incentives you get against it. We should advise our readers that this is not a comparision for the cheapest insurance policies available but infact a list of all the factors that shall hit the right note between value for money as well as giving you a 360º cover against all the hazards your car can be facing at any given point in time. Also, there’s no specific best car insurance plan as there are many variables that come into play while getting a car insurance and hence one policy doesn’t fit all as certain providers have specific benefits or additional features that may or may not be feasible according to your requirements. Insurance Estimated Value: This is the most important factor and determines the major chunk of the cost of your insurance premium that you will be paying along with the amount of cover you will receive in the case of filing a claim. How this works is that the insurance provider will ask you the amount that you wish to insure your car up to. After that, in case of a claim in which your car is totally damaged beyond repair, you will be reimbursed according to the decided value at the time of insurance OR the current market value of your vehicle, whichever comes out to be the lesser amount. If you wish to get a cheaper insurance then this cost can be reduced but the percentage of your damage costs carried by the company will also be reduced hence having a realistic market value at the time of getting your car insured is the sensible choice. Usually people in Pakistan underinsure their cars a bit to reduce the insurance premium cost because the market value of cars in Pakistani market doesn’t depreciate fast and used cars hold their value for a certain period of time. Depreciation: As with any machine, it’s subject to depreciation which means the reduction in value of an asset over time due to daily wear and tear. Hence your insurance provider will set two values against this. One is the annual depreciation rate which usually hovers around 10-20% and second is the duration in years till which depreciation will be accounted for. While searching for the best insurance for your car, select a plan that has these both values as low as possible. However certain people opt to pay more because depreciation doesn’t matter to them but getting day-to-day minor damages repaired and keeping the car in top condition might be high on their priority list. Also people travelling on long routes opt for higher insurance premiums because let’s be honest, in Karachi, there are frequent traffic jams and people don’t usually travel at very high speeds so the risk of getting caught in a major accident is not as high as inter-city long distance travelling. Deductibles: A car insurance deductible is a percentage of the total cost of the damage that has to be paid by the insured party before the insurance provider pays the remaining percentage of the cost associated with repairs. This cost can vary depending on the part that is damaged and is pending repair or replacement. The consumer should be aware to get all the relevant information on deductibles as the insurance provider will probably not get into all the nitty gritty details. Successful Claims Percentage: Before dishing out your hard earned money for a car insurance plan, it’s best to get a fair idea of how much claims does the insurance provider honor, the higher the figure, more the chances of the consumer filing a claim successfully after an accident. Claim Processing Time: Also make sure to ask your insurance provider of the maximum time taken to process an insurance claim. The lesser the time the better for the consumer as the provider would have to reimburse for your vehicle’s repair sooner. Additional Features: It’s also pertinent to mention here that we are living in the modern age and with the influx of newer technologies such as online payments, mobile money wallets and 3G/4G, insurance providers offer multiple avenues of filing a claim to facilitate tech savvy and the working class who is short of time to visit the insurance offices in person to file their damage claims. For tracking there is also the facility of tracking it online using a mobile application so you can have total peace of mind about your car’s location. Hence you should also count such features as plus points. Now that we’ve mentioned all the factors that influence the costs and the extra incentives that one should keep an eye on during the hunt for getting a car insurance for yourself we hope that this guide will serve in the best of interest of the consumers who are willing to get their vehicles insured.