Common Mistakes Teen Drivers Make When Buying Car Insurance

Picking Car Insurance As a Teen Driver: 10 Mistakes to Avoid

Amidst all the excitement of a new car, rushing through the car insurance purchase process is common, leading to a few mistakes that can cost a lot in the long run.

Here are some of the common mistakes to avoid when buying car insurance as a teen driver.

Focusing Only on the Price

One of the most common mistakes when purchasing car insurance is focusing solely on price. While looking for an affordable premium makes sense, it is equally important to ensure you get adequate coverage for your car.

Solution: Take an all-round view of the policy to analyse its coverage and premium balance.

Not Disclosing Information Correctly

Hiding information from the insurance company is another mistake drivers make. With the intention of securing high coverage at a low premium, failing to disclose information correctly can become a problem in the future. Claim rejections and insurance company blocklisting can be major issues.

Solution: Always disclose relevant information correctly. This helps you secure appropriate coverage and timely claim settlement in future.

Choosing Higher Deductibles to Reduce Premiums

A higher deductible usually means reduced premiums: an appealing factor for most drivers. But that’s not all. A higher deductible also means higher out-of-pocket expenses every time a claim is raised under the policy.

Solution: Before opting for deductibles, analyse your coverage needs and driving patterns to understand how likely you are to raise claims under the policy. As a new/ learner driver, choosing a higher deductible might not be the best idea, as your chances of making a claim may be higher.

What is a Deductible? A deductible is the amount you agree to pay at the time of settling a claim, and the remaining amount is paid by your insurer.

Hesitating to Ask Questions

Does the policy document seem to be full of new terms and jargon? Worry not, it is common for teen drivers to be confused about the policy, its coverage, hidden charges, claim settlement process, and more. However, not asking for clarification and assuming that all damages will be covered can prove to be a costly mistake.

Solution: Question your insurer to fully understand the policy. Ensure you read the policy documents diligently. Call the customer care for any queries.

Skipping Add-Ons to Manage Premiums

When it comes to purchasing car insurance, one size does not fit all. This is where add-ons come into the picture, which can be used to extend and customise coverage to meet specific needs. Teen drivers may look at add-ons as an additional financial burden. On the contrary, these add-ons are an affordable way to extend coverage on the existing plan.

Solution: As a teenage driver, look for add-ons that are appropriate for your car. For instance:

• Zero-depreciation protects you from paying the depreciation value of your car at the time of raising a claim.
• A return-to-invoice add-on ensures you receive the full value of your car if it is stolen or damaged beyond repair.
• Roadside assistance offers 24/7 help if your car breaks down, even if you are in the middle of nowhere.

Not Comparing Different Policies

Buying a policy just because your friend has one might not be the right approach. Two drivers may have identical car insurance needs. Not doing enough research and buying the first policy that comes in sight can be a mistake.

Solution: Head to the Jio Insurance Broking car insurance page. Enter your car details, and you will instantly see quotes from the top car insurance companies. You can easily compare prices and coverage before picking the one that best suits your vehicle's needs.

Making Small Claims

Knowing that even minor claims can be settled by the insurance company often leads to making frequent small claims. While this may appear beneficial, you should realise its long-term impacts, such as:

Losing No Claim Bonus: Your insurance company offers No Claim Bonus (NCB) for not raising any claims in one policy year. This bonus generally comes in the form of premium discounts that can reach 50%.

Losing Good Track Record: Too many minor claims throughout the policy year create a bad track record and place you in the high-risk category. This makes it difficult to find affordable policies with extensive coverage in the future.

Solution: Be mindful of the claims you raise. Not every damage requires the insurance company to step in.

Not Choosing the Right IDV

Choosing a low IDV solely to lower the policy premium can be a risky strategy, as it reduces the value the insurance company would pay if the vehicle is stolen or damaged beyond repair.

Solution: Choose an appropriate IDV, even if it means a slightly higher premium. This helps protect your vehicle in the long term.

Missing the Renewal Date

A car insurance policy comes with a defined tenure after which it becomes inactive if not renewed in time. It can lead to penalties, as a valid motor insurance policy is mandatory under the Motor Vehicle Act.

Solution: Ensure to renew your policy in time. While most insurance companies may send you alerts and notifications when it is time to renew your policy, keep the date marked in your calendar as well.

Summing up

When purchasing a car insurance policy as a teen driver, it is crucial that you avoid these common mistakes. Remember that buying car insurance can seem daunting at first, but with a few tips like understanding the inclusions and exclusions, looking for adequate coverage, customising the policy with add-ons, choosing deductibles wisely, etc., you can easily pick a policy that steps in during times of need. Secure your vehicles by keeping the above-discussed tips in mind.