How Fuel Type (CNG vs. Diesel) Impacts Insurance

CNG Vs. Diesel and Petrol Cars: The Insurance Reality

Typically, with any car insurance policy, insurers try to classify risks into two parts: severity, considering how large the claim is and frequency, i.e., how often the claim occurs. The fuel type of your vehicle, whether CNG, diesel, or petrol, affects both.

In general, as a thumb rule, there is a difference of 10-20% in the insurance premiums of petrol cars and other fuels like CNG or diesel.

Installing a CNG Kit in an Old Car

Planning to install a CNG kit in your old car? Here are some regulations you may need to know and consider adding to your car insurance policy.

1. To install a CNG kit in an old car, your four-wheeler must have a car insurance policy. It can be a third-party liability coverage or a comprehensive car insurance policy.
2. When planning to update the car with a new CNG kit, ensure you inform your insurer about this change. This way, your insurance company insures the newly added CNG kit.
3. Also, update the registration certificate accordingly.
4. Make sure you install the kit via an authorised workshop. Your insurer can also call for an inspection before your policy update.

Buying a New Car with Pre-fitted CNG

If you're buying a new car with pre-fitted CNG, you don't need to worry much. The process is very much similar to insuring any car with diesel or petrol, as the CNG kit already comes installed via the manufacturer. However, make sure your fuel type is mentioned in your registration certificate.

How does it impact your Premiums?

In case you're buying a pre-fitted CNG vehicle, the insurance premiums can be considerably higher than those for petrol cars. However, you can make a substantial difference by installing a CNG kit in your old cars. You simply need to pay an extra ₹60 to cover third-party liabilities as per the Indian Motor Tariff. Also, the increase in the premium of your own damage coverage may range somewhere around 4% of the cost of the CNG kit.

Insurance Premiums for Diesel Cars

Typically, the premiums for diesel cars are higher. Why? Because these diesel variants are expensive cars, they have a higher Insured Declared Value (IDV). Also, these are considered ‘high usage’ cars by insurance companies, which ultimately means the risks are higher, increasing the premiums.

Furthermore, some parts of these diesel cars are more pricey than petrol variants. This makes the repairs costlier, ultimately, increasing the premium prices.

Quick Checklist to Ensure You Maximize Your Car Insurance Benefits

Before you upgrade your car insurance policy, here is a quick checklist to make the most out of it.

• Inform your insurer about every modification in your vehicle to avoid claim rejections.
• Consult your insurer about the network garages for easy repairs.
• Match suitable add-ons to make your policy more customised and comprehensive.
• Track your no-claim bonus to avail premium discounts.

Easy Tips to Lower Your Car Insurance Premiums

Here are some tips and ideas to lower your car insurance in some easy and smart ways.

Check your No-Claim Bonus

Tracking your no-claim bonus and stacking the same can help you avail discounts on your car insurance premiums. You can also transfer your NCB benefits for a new car.

Safety Devices

Several insurance companies also offer premium discounts for safety devices like gas leak sensors or fire extinguishers.

Renew Online and On Time

Also, renew your car insurance on time. This way, you will be able to avoid the late fee or associated penalties. With online renewals, you skip the middleman and can compare multiple insurers before policy purchase or renewal.

Choose a Higher Deductible

Choosing a higher deductible can lower your car insurance premiums; however, you would have to pay your share when a claim is raised.

Pick the Right Add-Ons

Pick your insurance add-ons wisely. For example, for CNG cars, fire cover is a must. For diesel cars, add-ons like zero depreciation, engine cover, consumables cover, and more are available. Do not over- or underbuy. Add what fits your usage.

Drive Safely

Driving safely and responsibly can also help lower your car insurance premiums. It helps maintain a clean claim history that makes policy renewal easy and affordable.

Wrapping Up

Choosing a fuel type might be associated with what you pay at the pump; however, it is a lot more than that. For instance, if you're choosing CNG, make sure you choose certified equipment and make necessary declarations to your insurer. You may also compare different insurers and look into their policy benefits to bag a better deal.

With Jio Insurance Broking, comparing car insurance becomes super easy. You get access to several insurers, where you can easily compare the prices, policy features, coverage, and exclusions. This way, you choose a motor insurance that best matches your needs and budget.