Car & Bike Insurance premium increased this year

O

ontherocks

Disciple
If you claim insurance in a particular year, you loose the NCB in the next year. Does the premium also increase the next year in spite of the fact that IDV decreases? I thought the only thing you loose is NCB if you claim.
I hadn't claimed insurance in the past and each year the premium used to decrease by approx Rs.1200. Last year I had to claim insurance twice. This year, instead of a decrease in premium, it has rather increased by Rs.800 from last year. Why is this so?
 
Your premium value depend on the IDV. NCB is discount on the Insurance sum. If you IDv keeps decreasing, your insuranve sum will keep decreasing.

For example:
First Year:
IDV = 500000
Insurance is 10% = 50000
NCB is 2%(not sure) = 0 (first Year)

Second Year:
IDV = 450000
Insuramce sum is 45000
NCB is 2% = 1000 which is discounted
So total insurance is 35000

Third Year with a claim
IDV = 400000
Insurance sum = 40000
NCB is lost on account of claim
Total Insurance = 40000 (which is 5K more than your premium last year, but insurance amount is less than last years premium without the NCB)

The premium actually does not increase, It gets calculated based on your IDV but since you did not get discount of NCB, it seems that your premium has increased.

Don't worry, Your insurance premium will reduce again next year, provided there is no claim.

Note: Percentage values are just for example purposes, I really dont know the values but the system works in this manner.
 
Since you claimed insurance , you lose the NCB benefit you got for the past years, so you are charged the full premium that is applicable for your vehicle's IDV. There are also scenarios when insurance companies bump up the insurance premium if they feel that you are a 'high risk' customer. Happened to me when I made multiple claims in successive years. I simply changed the provider to get a lower premium. There are sufficient number of good players in the market, and atleast as far as car insurance is concerned, customers have bargaining power. One just needs to ask.
 
Thanks a lot adilj for the detailed explanation.:1ign26:

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agantuk said:
There are sufficient number of good players in the market, and atleast as far as car insurance is concerned, customers have bargaining power. One just needs to ask.
Click to expand...
I tried that last year just to see what others have to offer. Everybody seemed to quote similar and no one was interested in "bargaining". All of them said "This is system calculated saar......we cannot do anything about it". :(
I have National Insurance given by the Maruti dealer that services my vehicle. They convinced me that even though their quote was a more my Rs.200 or so as compared to others, any claim process with them would be smooth and hassle free since they have tie up with the Insurance company and they are the one who is going to do all the repairs.
 
Standard bargaining tactics generally work. "Give me or I am not interested", "ICICI guy is calling me back tomorrow, I will go with what he is offering" and the likes. Also preferably start your hunt towards the end of the month, agents would be more interested considering the "meet end of month targets" time.
 
@ontherocks : Check the online quotes offered by the insurance companies, mostly its much lesser than what's offered by the agents.
 
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