Every year, many policyholders commonly contemplate whether they can stay with the existing insurance provider or switch to a new one. If this is you, take 3 minutes to read this blog and make an informed decision!
This dilemma of deciding on your purchase is not for motor insurance alone. Haven’t you thought about buying a new smartphone? On whether to choose the premium version of your existing smartphone brand, or shift to a new one that offers more bang for your buck?
There is no one-size-fits-all approach to any of these decisions. The answer depends on what your expectations are and your current scenario. We shall look at a few scenarios next.
Remain with the same motor insurance provider to enjoy the following
- Good Reputation and Performance- Does your insurance provider have a good track record of on-time settlement, and a high payment to claim ratio? Then, you have good reason to stick on. Do not move to a new policy only because the premium might be a bit cheaper.
- Perks- These are gifted to long-standing customers by the insurance companies. If you have had a continued association with your car insurance provider for a few years, there is a good chance that you will become eligible for discounts that the insurer has to offer. The combined value of these may beat any discount you get on a cheaper premium while switching, so do check!
- No Claim Bonus (NCB) – It is a reward offered when you do not claim insurance for a specific time interval, say a year. With the NCB, you can reduce the insurance premium payable in subsequent years.
Change your motor insurance provider if
- The Performance is unsatisfactory- Is the company not prompt in settling claims? Is the time taken to settle claims long and the customer service poor? If your answer is ‘YES’, you might consider looking at other insurance plans.
- A Better Plan is Available- New insurance plans with innovative features and coverage options are always on the rollout. If you have done your due diligence properly and feel that another insurance plan is a better fit for you, then you can switch.
- You have moved to a new place- If you have moved to a new location, you must notify your insurance provider. Especially, if the shift is from rural to the urban area or vice versa, you might find that new better options are available for you because of the shift in location.
Cautions to keep in mind before switching
- Cancel the existing plan – Ensure that you have properly cancelled your plan, so that the billing cycle does not continue. This might result in additional bills and confusion for you.
- Ensure there is no gap in insurance coverage – Plan ahead and transfer between insurance providers seamlessly. Avoid gaps in insurance coverage when you transition between different providers.
- Do your Due Diligence – Choosing a new insurance policy just because an insurance agent recommended it? Or because the premium is lower? A big no. Do your own due diligence before making the decision to switch to a new insurance provider.