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Last Updated : Sep 12, 2019 08:13 AM IST | Source:

Motor insurance premium calculator: All you need to know

Motor Insurance Calculator is used to get the best quote for your vehicle. Check out the benefits of motor insurance premium calculator & how to use at Moneycontrol.

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Mandatory multi-year purchase of third party insurance has pushed the cost of ownership of cars higher. Buyers now have to buy three year insurance instead of one year. Registration fees for vehicles was hiked by 13 times by the Centre. This however has not been put off till June 2020 (Image: Pixabay)
Mandatory multi-year purchase of third party insurance has pushed the cost of ownership of cars higher. Buyers now have to buy three year insurance instead of one year. Registration fees for vehicles was hiked by 13 times by the Centre. This however has not been put off till June 2020 (Image: Pixabay)

If you are looking for the best motor insurance policy for your vehicle, it is a good idea to compare policies offered by some popular insurance agencies. One of the key deciding factors for a motor insurance is the premium one has to pay.

Almost all insurance agencies and aggregator websites offer online calculators where you can find out potential premiums. All you need to specify is the make and model of the car, the age of the car and the city of registration. You can then get premium quotes. Based on these quotes, you can compare policies online and zero in on the best option for you.


Advantage of Motor Insurance Calculator

It is advisable that you compare insurance policies before you finalise on your insurance agent. With insurance premium calculators available online, it is now easier to compare premiums and policies.


Here are some of the advantages of motor insurance calculator:

-The online insurance premium calculator saves a lot of time spent on choosing the right insurance policy. You save the time required to visit different insurance agencies and ask for quotes from them. You can get quotes at the click of a button and at the convenience of your home.

-Not just policies, you can also compare insurance rates offered by various insurance agents. It is easier for the customer to get a bird’s eye view of all aspects of the policies using a single tool.

-The tool lets you choose the right option based on your needs. You can make changes to your inputs and look for change in premium calculated by the tool.

-With the insurance calculator available online, it also reduces the interference of agents and other middlemen. The entire process of comparing policies and applying for the right one becomes seamless.

-Not just insurance agents, several aggregator websites also offer this tool. It is more convenient for the customer as these aggregators let you compare premiums across insurance agencies.


How to Use the Motor Insurance Premium Calculator Tool

The motor insurance premium calculator is a simple tool. Using it does not require rocket science and you can start comparing insurance policies in minutes.

Once you have accessed the premium calculator either at the insurance agencies’ websites or at any aggregator website, you need to enter some details based on which the tool will calculate your premium.

At first, you need to enter the make and model of the car. This is one of the key deciding factors in the calculation of premium. The next important bit is the sub type of the vehicle. For cars, it could hatchbacks, sports car, etc. In case of two-wheelers, it could mean geared, non-gear etc.

If it is an old car or bike, you will have to enter the age of the vehicle and existing insurance policy numbers and covers. You will also have to specify if there have been any previous claims on the vehicle.

Another important pointer is the fuel type of the vehicle. Registration details, too, are important. Enter the registration number and city where the vehicle is registered. Then comes the details of the owner of the vehicle. If there have been any change in ownership of the vehicle, enter the details.

Based on these details, the calculator will estimate your premium. Calculations are done based on the following formula:

Total premium = Own-damage premium + third-party liability premium + cost of add-on covers –discounts.

You can tweak the entry fields if you want to see any change in the premiums.



What are the factors that decide my insurance premium?

The insurance premium for a vehicle depends on several factors. The model, make and age of your vehicle are of utmost importance. If you have an existing policy, your new premium will also depend on how often you’ve made claims earlier. If you have a no claim bonus, it is likely to pull down your premium considerably. The condition of the vehicle in question is also taken into account while deciding insurance premium. How many times the vehicle has changed ownership as well as the age of the owner may also play a part in premium calculation.

Does the insurance calculator work if I want to renew my insurance?

Yes. You can use the insurance premium calculator tool to compare policies at the time of renewal of your insurance.

I have not made any claims during my first insurance tenure. Does it help me while getting a renewal?

Yes. Although motorinsurance policieswork on the principle of ‘use it or lose it’, you also benefit from special discounts for not making any claims. It means that even if you are paying premium every year, if you don’t make a claim for a serious accident that year your premium will lapse. But at the end of your insurance tenure, you will also get zero-claim discounts.

Does the premium calculator provide accurate estimates?

The premium calculators use a standard formula to give you an estimate of what your premium is likely to be. However, the calculation formula may vary from one insurance agency to another. So, the actual premiums charged by the insurance agency may be slightly different from the ones predicted by the calculator. Moreover, insurance agencies take several factors into account while deciding premium. For instance, the calculator may estimate your premium to be Rs10,000 a year but after a survey of your vehicle, the agency may charge a premium of Rs12,000.

How can I ensure a lower premium?

There are several ways to get a lower premium quote from insurance agencies. A simple method is to join the Automobile Association of India (AAI). This gives you a discount on the premium. Another method is to install an anti-theft system on your vehicle. You can also abstain from unnecessary add-on covers for your vehicle. Lastly, purchase a vehicle that caters to your needs. An expensive vehicle would mean you have to pay a higher premium as showroom price and cubic capacity of the vehicle contributes to the premium.


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First Published on Sep 12, 2019 08:13 am
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