No Free Lunches While Choosing Car Insurance

In the cut-throat car market, it is now not unusual to hear a automobile dealer imparting free insurance cowl on the vehicle or charging as little as a rupee.

While this may additionally seem as an desirable proposition initially, you may have to experience the pinch later. Dealers imparting car insurance plan for free or for a nominal quantity at the time of buy are now not probably to provide you a right deal on renewal of the policy cover.

Car sellers get a fee for promoting a specific insurance company’s policy. Both small and big insurers have agreements with various auto sellers for promoting their motor insurance policies.

While the huge players in the motor insurance plan segment have been following this practice for long, small and mid-sized insurers are following go well with solely now.

Once the automobile insurance policy is sold, the insurance plan association passes on the commission cost, which it has to pay to the dealer, to the policyholders as a top rate cost.

Consequently, policyholders have to pay a higher amount than the ordinary premium when the time for policy renewal arrives.

The ordinary top class for a vehicle insurance plan policy depends on the location, the make of the vehicle, its age and claims history. At the time of renewal, vehicle dealers load the fee value they are to get from the insurer with the top rate amount.

As a result, policyholders do now not get the full discount offered through the insurance organization when they purchase the coverage from a dealer.

Following detarrification in the common insurance segment, even the channel through which the policy is acquired is also making a difference.

“The burden of the overriding fee fee goes to the customer. As this exercise is followed via nearly all popular insurers with a motor insurance portfolio, clients need to exhibit greater discretion before signing the dotted line. Moreover, it is vital that they choose for a policy presented by using a financially sound insurance plan company with a desirable claims history”, says Sourav Acharya, Insurance Consultant, Bajaj Allianz General Insurance.

David Parks is a properly recognised creator and has written articles on Buy Trade Leads [] and B2b Marketplace

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