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Hi rjvora,

A insurance renewal question. :)

Details: Fiesta 1.4TDCi ZXi, insured from 9th Jan '08 to 8th Jan '09, with a premium payout of Rs21979/-. The year of MFG is late 2007, even though delivery was taken in Jan '08.

Its time to renew and what all discounts should I ask for. The current insurer is Bajaj Allianz. I went through a few threads but its kind of confusing.

Hi recently had an accident with a scooter hitting my skoda laura bumper and fog lights etc.

The insurance company was ICICI, every thing went fine. (Getting 50% of parts and 100% of labour)

Issue: The insurance company has claimed that Fog light bulbs are consumables and cannot be claimed for.

For a laura each fog light buld (not fixture) is Rs. 700 and each xenon is 12000 (not damaged luckly) they consider this in the cost of the car while giving the insurance out, then why do they not pay for the same when we have an accident.

There will be 2 types of discount one would be NCB and other would be other discount. Ncb would be 20% and other discount would be more then 15% (You can bargain this with a company)

One thing I need to ask you is the fog light is insured separately or not? If not and if they are of very heavy cost then I would advise you to insure them also along with your motor policy. This Xenon bulb can be covered then.

Bajaj has the maximum business in Pvt. company (Which is higher then 2 government company)

Thanks rjvora. One more question, the discounts will be on the depreciated price of the car or is there some other calculation?

All the discount's are given on basic OD premium. Please tell me before finalizing how much did company gave you other discount.(%) Remember that you have to bargain this one.

Will do sir. Please check your PM.

I hope you have received my reply too.:D:D

I actually had a big chat with a Car Insurance agent today and this is what I discovered. I've made some assumptions of my own and some from facts that I found out. If I'm wrong please feel free to correct. I couldn't find a right thread for this, so here goes.

1. Calculations for insurance varies. Typically its the agents discretion on how he wants to calculate !! There are guidelines given by IRDA and the Insurance companies.
2. % of discount varies from one Insurance company to the other.
3. Beware of very cheap insurance amounts. You could be caught with a higher compulsory deduction value.
4. Third Party coverage might not have been taken into account.

Its a myriad of calculations when getting to the actual premium to be paid.

Here's one small example using one approach

Lets take the IDV (calculated based on age of vehicle) - Rs. 9,00,000/-

Insurance premium is calculated as a % of the IDV.
Less than 1000 cc - 3.123%
1000cc - 1500cc is - 3.283%
1500cc + - 3.440%

Base Premium - 30,960
20% No Claim Bonus - 6192 (20% for first year)
So Premium - 30,960 - 6192 = 24768

Now depending on the Insurance company there is a discount that is given. I got 40% for Tata AIG and 33% from Royal Sundaram.

This 40% is not extended to all models and makes. For example a Verna, Santro or an 800 does not get this. Only the Grand Vitara from the Suzuki stable is eligible. All Mercs, Audis, top end sedans get this 40%. Its more to do with the reliability and safety features that are available on certain models that help make this cut !!

So after 40% discount on 24768 = 14860/-

Add Third Party Property Damage(TPPD) 2500 for 1500 cc cars=14860+2500= 17360
Add Accident Cover to Owner-Driver (Rs. 100)
Add Liability to Paid drive(Rs.25)
Total = Rs.17485/-
ST @ 12.36% = 2162/-
Total Premium = Rs.19647/-

Now comes the sinister part. There is another % that the Insurance agents have to calculate the value. This is based on type of vehicle, make, no. of years old. This % is less than the earlier one for almost all types of vehicles. For the Civic the % was 2.408%. The twist here is the discount given here is 10-12% max.

Doing the math on both, I found the first one worked out cheaper.

The second one is where you get discount for
a. having an Anti Theft Device installed (2.5% or max of 500)
b. Automobile association (5% or max of 200)

So be sure to ask your insurance agent the basis of the calculation and how he got to the final premium no mentioned.

I for one got a renewal notice from Royal Sundaram who hadn't explained anything except the NCB and had quoted 25K as my premium. Turned out they had given me a 20% discount. Whitefield Honda called me up and said they would give me a 10% discount.

Anything to add to this Insurance gurus?

Very nice write up, I must say that. You have done a good research. I will give you one more easy option for doing this.

Ask the person who is giving you the quotation that how much % Ncb he has given and what is the final premium? (Make sure that IDV is same in all the quotation)

One point you missed out was an unnamed P.A. – you should have this in your policy (Must, Must, Must) Add this full in your policy (Rs. 100 per person for Rs. 2,00,000/-) Multiply this amount with the sitting capacity of your car and add it to the TP calculation. (100 + 25 + P.A.):D:D

Yes, I forgot to mention that. He said you can take a minimum of Rs. 50/- till a max of Rs. 500/- per person I think for P.A.

The NCB% is the same across insurance companies isn't it. If one has no claims for a year its 20% and that's what he gave me.

Also the Discount is on (Premium - NCB) and not on the base premium itself.

I would like to correct you please:

1. It is not Rs. 500/- per person. It is Rs. 100/- per person. (Rs. 200000/- sum insured.)
2. Ncb is same in all the company but only first claim free year it is 20% then next year it is 25%, then next year it is 35% then next year it is 45% and the maximum is 50%.

Probably I didn't make myself clear. What you said is what I was also trying to say !!
:)

Just that you can pay from Rs. 50/- to Rs. 500/-(being the upper limit) for P.A. Standard practice is 100/- per person, yes.

Yes to the second point as well. You had earlier asked me to find out the NCB% that was given. Well my question was, the % is the same across all the companies for N year(s) of no claim, isn't it?

Anyways I'm not sure how many folks understand what we are talking about !! ;-)

Yes for all the company this is the same way of giving % of NCB.:)