Striking Right Balance between Cheapest and the Best in Car Insurance

Striking Right Balance between Cheapest and the Best in Car Insurance

It is an age-old feud between money and value whenever we make a purchase decision. Though our pockets demand priority, we also want a product which is the best. Perhaps this is the reason why we throng malls in the sale season – to get the worthiest (read: branded) products at the cheapest possible price. Whether it is our apparels, gadgets, appliances or our daily grocery, we always compare the value, features and brand of the product and if the product is the best in its category, we do not mind splurging a bit more in terms of price. But what happens when we set out to buy a car insurance plan for ourselves? All the plan’s features and benefits are given a miss and only the asking price (premium) is considered. Isn’t it true?

A car insurance policy is usually considered an unavoidable expense and so the policy with the cheapest premium is usually bought. Though the premium rates are an important consideration, does it mean that we should ignore the plan features and settle only on the premium factor?

Value over Price

Exploring the car insurance policy’s features and the coverage option is important. The following arguments dictate that the coverage features of your car insurance policy need your attention.

  • The coverage type – if price had been the only consideration wouldn’t we have settled only on the mandatory third party liability policy? The premium is the cheapest that it can get. But is the coverage sufficient? What about damages incurred to your own car or, worse, to you? We all seek a comprehensive coverage option because it also covers damages faced by the car itself and the owner. A comprehensive policy is dearer than a third party plan but still finds many takers. Aren’t we valuing the coverage here instead of the premium?
  • Add-ons – riders are additional coverage benefits which can be added to the base policy for a more comprehensive protection of our car. Add-ons increase the premium rate though only marginally. However, one cannot ignore the substantial coverage enhancement they offer. For instance, the engine protector rider is a blessing in monsoons when water-logging might damage the car’s engine and sabotage the claim. Doesn’t a rider’s value outweigh the price factor?

Price does matter

Despite the value-enhancement, price does matter. Since the cover is mandatory, premium affordability needs to be checked. Prioritizing price over value is not entirely worse either. It is, after all, our hard-earned money that we are talking about and splurging it on unnecessary value-additions is never recommended. So, how does one achieve a balance between the right values and the right price? This is a conflict which can be solved by the following two factors:

  • Suitability – the coverage of a car insurance policy should be chosen only after assessing its suitability to your requirements. There are many car insurance riders available and though each one has its own coverage benefit, a rider should be selected based on its applicability to your requirements. For instance, the roadside assistance rider helps in case of a car breakdown but would be useless if the policy already provides such assistance in its coverage features. Similarly, the zero depreciation rider is not applicable if your car is quite old and you are looking to invest in a new vehicle. So, you should study your car’s coverage features and ensure a coverage which is apt for your needs and you would be able to strike a balance between the coverage and its price.
  • Car insurance comparison – the perfect solution to achieve the perfect balance between the price and value is to compare between the different available car insurance plans. Only a car insurance comparison.can help you in analyzing every plan’s coverage feature against its premium. So, before you invest in a plan take time out to compare and research the different car insurance plans.

Though the debate between the best and the cheapest car insurance policy is constant, you can achieve a balance between the plan’s value and price. By assessing your insurance needs and then comparing between the plans catering to your needs, you would be able to afford a policy which has the right price and provides the best coverage.

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