Can Car Quotes determine the car premium?
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Car Quotes help you to understand the rating system of car insurance policies in the UAE market. And this comparison led your car premium to be decided on basis on certain factors.
Some people think that only the type of coverage i.e. TPL or comprehensive has an effect on the insurance rates but there are in fact many factors involved in the calculation of the motor insurance premium prices.
In the UAE where car insurance becomes a legal requirement for everyone to have it as soon as possible to make you a read-worthy driver.
These insurance policy purchases move towards security and a premium is set to be paid monthly for this security.
Insurance companies in the UAE inquire about different factors related to your car to determine which insurance policy will be more suitable for you and how much will it cost to provide you the required coverage.
These variables include car value, car brand, car make and year of manufacture and place of registration.
The quotes stated by your insurance company are based on the factors that will contribute to the calculation of your premium which ultimately will be the price that you will have to pay for your insurance coverage.
Thus, our expert’s view has led us to jot down the essential pointer to show how car quotes determine a car premium.
1# Type & Features of your car:
Insurance coverage for different types of cars costs differently, luxury cars and high maintenance cars cost more to get them insured.
This depends on the worth of the car itself as well as the cost of the spare parts for damage repair in the events of an accident or a claim.
This is because the safety features of those cars are up to date making them low-risk vehicles.
Motor insurance companies quote their prices based on how risky they perceive you and the type of car is the major contributor to determining the risk you possess.
Some of the other factors that determine the value of the quotes you receive from your car insurer are:
- Usage of your car, whether your car will be used for private purposes or will it be available for public use like for transportation services
- Whether the car you have is imported or not
- Does your car has GCC specifications or has it been modified
- Driving history of the policyholder and age of the driver
- Whether you have made any recent claims or do you have a no claims certificate
- Coverage type that you want
- Whether you are opting for any add-ons or not
- Deductible or excess
Therefore, the car model and type matter a lot in deciding the premium of the vehicles.
2# Premium rates for high-risk drivers:
The motor insurance companies do not want to carry any liability, so they make sure to keep their end covered.
- When you ask for car quotes from your insurance provider, they ask you a number of questions which may seem like a waste of time.
- But by asking those questions, your insurer is trying to determine the level of risk you will be bringing as a client.
- If you’ve recently got your license then the chances of high premium rates are greater as it depicts the lack of driving experience.
- If you’ve frequently made claims in the past or have a record of tickets then you will be considered a high-risk client and your insurance premium rates will be higher.
Hence, in some cases, the insurer will go to the non-renewal policy route depending upon the level of risk a client may present.
3# New drivers can also get affordable prices for insurance:
If you have recently gotten your driving license then you will automatically have to pay a higher price to get your car insured.
Insurance companies consider the lack of driving experience as an increased risk of being involved in accidents.
The new drivers consider it an unfair deal.
Thus, there are some basic steps that new drivers could keep in mind when they go to buy car insurance for the first time and can get a fair price.
- New and higher value cars are more costly to get insured in general. So, if you lack driving experience there are chances that you will be charged an even greater price. To avoid paying extra because of the worth of the vehicle, you could go for the second-hand car or low-value car for your first time getting motor insurance. This way, you can avoid the double increase in your car insurance premium.
- Carefully analyze the coverage you need and prioritize the add-ons you buy. Being a new drive, getting all ends covered is a very good practice but make sure that you only get the coverage that you require. If you just use your car to commute to your college and back, then getting GCC country’s coverage is merely useless. It will only add up in the price and will be a waste of money.
- Having a clean record helps. Even if you are young but you don’t have any traffic rules violations on your record then it will help to build your good reputation in front of your insurer and may get you some discounts.
4# Try to reduce the cost of insurance:
There are some factors that you cannot control and they will increase the price of your motor insurance but some of the factors are still in your control.
By just being smart and responsible about how you drive and make purchase decisions could help in the reduction of your insurance cost.
By being careful, you can get discounts at the renewal of your policy like the no claims discount.
- Unnecessary add-ons: do not get the coverage that you know you won’t be using but you are just trying to be extra careful. Being vigilant and careful is good but having unnecessary coverage will just increase the price. Just get the coverage that is specifically suitable for your needs and skip the rest.
- Don’t go for agency repair: if you really want to lower your insurance coverage cost then go for garage repair. Getting your car repaired at an authorized agency repair in case of an accident just multiplies the cost of your insurance.
Thus, there are other things that you can check while making the purchase decision and it can save you a significant amount of money.
When you go for buying an insurance policy, your insurer usually tells you about the discounts that you are eligible for.
In case your insurer does not do so, you should definitely ask them about the discounts that are applicable to your coverage.
The most common discount that people get is no claims discount. This is the discount you get if you’ve not made any claims in recent years.
Hence, you can get this by asking your previous insurer for a no claims certificate and then presenting it on the renewal of your policy.
The quotes you get from your motor insurance company is based on the information you provide and the type of coverage you are trying to buy.
The accuracy of the information that you provide is directly related to the accuracy of quotes that you will get.
Originally published Feb 23, 2021 14:09:00 PM, updated May 18, 2021