An Easy To Use Guide For First Time Buyers
Just like we need insurance for our health, insurance for our travel, we need insurance for our cars too. We live in a world where maintenance cost is more expensive than buying a new car and this manipulates the need for insurance. We all like a little extra stash of money in our wallet but it is quite challenging when you have a car or multiple cars which needs to be insured. The outcomes for not having car insurance are never worth the risk especially in Pakistan where traffic load is increasing day by day, poor road conditions and ‘not so good’ driving habits with a little sense of traffic rules result in accidents on daily basis. Therefore, covering your car with a decent insurance policy is essential but, with a wide variety of eye-glazing policy options in the market, it is difficult to figure out the best car insurance in Pakistan.
Have you invested your hard earned money on a brand new car and now that you are behind the wheel, you are worried about its safety and protection? And given the driving habits in Pakistan, sudden accidents, theft, vandalism, falling of trees are a norm and they do happen, and when such situation arises, insurance is the best fall back cushion that keeps our finances safe and sound.
For making smart decisions one should be smarter by knowing and understanding what he is dealing with. In this blog, my aim is to explain everything you must know about insuring your car, it’s key features and purchasing.
- What Is Car Insurance Policy?
In simple words car insurance means: “An agreement which is made between you(insured) and insurance company(insurer) that you will pay(premium) to insurance company which in return guarantees that if your vehicle meets an accident and is damaged or destroyed, the insurance company will pay to return it to its original condition, or have it replaced. Similar is the case with physical injuries: The insurer guarantees to pay for the medical aid you need to recover until you return to your original state of health.”
Types Of Policy:
There are three main types of insurance policies:
- Third Party Only (TPO)
Third party car insurance covers the damage of someone else’s property or injuries in the event of an accident that was your fault but, it does not provide cover for you or your car or if your car was stolen, damaged or destroyed by fire.
- Third Party, Fire, And Theft (TPFT)
Third party, fire, and theft (TPFT) cover provides the same level of protection as third party insurance in addition to that, it also covers your vehicle if it was stolen or damaged by fire.
As with third party only, TPFT insurance won’t cover any damages due to collisions or accidents.
- Comprehensive Cover:
Mostly vehicle collisions result in some damage to both vehicles. If you cause a crash your third-party insurance will only cover costs for the driver you hit. If your car is damaged too, you are unlucky unless you have comprehensive collision insurance. This coverage will pay for the damages to your own vehicle if you crash into another car or an object. It also helps you out with damages caused by other unfortunate events (vandalism, theft, fire, natural disasters, etc.).
2. Ways To Get Cheapest Auto Insurance Possible
Now if you are fully aware of auto insurance policies and its importance, below are some significant things you need to look before choosing the right cover. Finding the premium auto insurance in Pakistan can be very daunting in this era, however, few points can help you find out the best for your needs.
- Shop Around For The Right Quote:
You will be surprised after reading this, our top tip to get cheap car insurance in Pakistan is to shop around, compare quotes, consider the odds, and then make the right choice. You can save thousands of rupees if you shop around to find a new cover for your vehicle. Premium rates and policies vary among insurance companies. The best idea which is easier, quick and time efficient is to use an online website for comparing quotes and policies and then buy the best deal for your car and your pocket.
Try Karl compared to find the cheapest car insurance in Pakistan for you. Whether it is day or night, you can choose from a wide variety of products offered by Pakistan’s leading insurance companies.
- Consider The Right Coverage:
If your car is old and has a low market value then considering 3T(Total loss policy, Theft policy, and Third party policy) cover may be the right choice for you to save some money rather than shelling out on the comprehensive cover. Be smart, first find out the value of your car then weight the value against the premium you will pay for the cover then determine it is worth it or not.
- Look Out For Discounts:
To maximize your savings check out for all the possible discounts provided by insurance companies for customers who:
- Have a clean driving history.
- Pay for their insurance annually with one lump sum.
- Ensure multiple cars.
- Group together car insurance with other insurance policies for example home insurance and buy from the same insurance company.
- Boost Your Excess:
Don’t forget to check your voluntary excess carefully which is attached to your policy. This is the amount you pay yourself when you make a claim. Agreeing to pay more voluntary excess in your policy can bring down the price of your insurance policy, so work out with how much you can afford to pay towards the costs in case of an accident and then declare your excess accordingly.
- Provide Your Vehicle Security:
By making your vehicle more secure, it can attract a discount on your premium. Insurance providers like cars which are parked in garages or on a driveway instead of parking in the streets. Aside from the benefit of not having your car vandalized or stolen, this can cut your premium. So make a move and clear out your garage if it is full of junk!! Also, fitting alarms, tracking devices or steering locks in your vehicles can dramatically reduce your premium.
3. Tips for Lowering Your Car Insurance Rates
These days when a person buys an automobile, auto insurance is the top priority, and frankly speaking, this is how it should be. Since the prices of cars keep increasing every day, the cost of insurance coverage is also on the rise. Likewise, the renewal of insurance cover also needs an in-depth examination prior to renewing or purchasing fresh car insurance.
Below are some good tips for lowering your car insurance rates:
- Lowering the auto insurance rate is your right; this, however, does not mean you go for a company or an insurance package that compromises the whole idea of having valid and viable car insurance. Car insurance rates differ a great deal from one insurance company to another. A detailed search and window shopping can bring you the expected results. With such data at hand, you are now well equipped to lead smart negotiation thus saving handsome amount each year. Needless to say, your market knowledge on which insurance company is most competitive is paramount
- If you are buying a new car you must build in the insurance cost, remember this is not a onetime cost. The car insurance premium needs to be paid each year when the car insurance policy is renewed. It is better to buy make or a model whose insurance expense you can manage without a break. A relatively inexpensive car will surely have a low insurance rate
- The car insurance in 2018has risen fairly high. This is mainly due to the increase in government taxes on spare parts and accessories. The rates for out of market makes and models such as Mercedes, Audi, BMW may be slightly higher to regular makes such as Honda, Toyota or Suzuki, irrespective if the cost is similar or slightly differs. This is because the insurance company feels the repair cost will be significantly higher because of spares and accessories. By choosing the right model you can reduce the insurance rate to a great degree
- Try to take care of minor repairs due to accidents by yourself instead of asking the car insurance company to foot the bill. This way when you renew the car insurance policy you can demand no claim bonus thus lowering the insurance rate quite significantly
- There are several general insurance companies who would be willing to offer home insurance along with car insurance at highly competitive insurance rates. If you have any plans to buy an insurance cover for your house, office, factory or a shop combine it with your car insurance to avail best possible deal
- Similarly, if you are a two-car household having one insurance company for both the cars, you can fetch great deals that can help you save decent money and reduce the insurance rate.
- If your car is safely parked inside the house premises and is chauffeur driven maybe you can exclude the accessories such as an expensive audio system, navigation system, DVD player from the list. This will significantly lower the insurance rate
- The renewal premium must be paid before the insurance cover lapses. There are two main reasons:
- The car is fully secured and never at risk. In case the car insurance has expired even for a single day you have given an excuse to the insurance company to shy away from settling the insurance claim. You can rest assured that the insurance will not pay even a dime
- By buying car insurance before the earlier expires you can demand no claim bonus lowering insurance rate. Supposedly your current car insurance expires in December 2107, you should have renewed your insurance before 2018 begins
- It is advised to pay full premium in one go. Otherwise likely are the chances you will forget to pay quarterly installments thus making your car vulnerable and perhaps you’ll not receive a good insurance rate.