How Vehicle Value Impacts Your Insurance Premium
Does your Vehicle Value Impact Your Insurance Premium?
Choosing the right car insurance policy is necessary for a car owner to avail the maximum number of benefits. There are many factors that affect the car insurance premium, some of which are car-related and others which are driver-related. However, one of the most important elements to consider while browsing the car insurance premium is the vehicle value. Many people wonder how the value of a car can have an impact on the insurance pricing.
Insurers look at a long list factors while computing the car insurance premium. Some of the top factors are as follows:
Low-Value vs. High-Value Cars:
Even if you have bought a car for a low price, it does not mean that the you can avail a cheaper insurance policy for your car. Surprisingly, at times the Insurance for a lower-value car can be more than a higher value vehicle. Some of the lower-value cars would not be functioning properly or might have been involved in an accident. Thus it can be difficult to procure spare parts for older vehicles.
Insurance companies normally evaluate a vehicle based on the below parameters:
- Age of vehicle
- Make and Model of vehicle.
- Fuel type
- Engine size
Premium Goes Up:
Some people are worried about their vehicle value depreciating every year, but the insurance premium is getting higher year after year. The value of your car can keep depreciating every year (at least by an average of 20%). Below are some key points on the reason behind the increase in premiums:
- Repair Costs
- Driving History
Overvaluing Your Car:
One of the most important aspects to consider is not to overvalue your car while looking to take an insurance policy. This can lead to a higher price point on the overall insurance policy.
AWNIC encourages customers to enter their entire vehicle history, make and other aspects and provide a ball park figure based on which the insurance value can be calculated.
To avail AWNICs car insurance, visit our digital channels which are :
✔️Download AWNIC App: