Do you know Why your Car Insurance Premium is so costly?

There are many options that are available for insurance buyers in the UAE. It becomes very difficult to select the insurance policy which suits your requirement. You should have insurance that provides protection as per the UAE regulations. It is observed that third-party coverage will not be sufficient for the cars. 

It may look like you are saving on insurance premiums when buying the policy but in reality, you will be paying more than you expect. If you experience that your insurance premium on a car is more and you're spending a lot of money on car insurance and its maintenance. 

Take the below reasons into consideration which are the real problems for making the insurance premium amounts highly expensive. 

1. Check your Driving Record

Driving history is considered as one of the main reasons for considering the insurance premium in the UAE. If you are not having a good track record of your driving then you will be paying more on your insurance. The premium amounts are higher compared to the policyholder having the best driving skills. 

If you are having this challenge then it is advised that you take courses offered by the UAE government. This course will help you to reduce the black points on your record. If you successfully complete the course black points will get reduced and you will be eligible to get good deals during policy renewals. 

2. Your location is an important factor

The insurance premium is not only affected by the age, gender and history of driving, it is also influenced by the location from where you stay. There is no rule about the insurance premium amounts from the location but the risk factor in the location where you stay is detrimental in deciding the insurance premium amount. 

Areas with high crime rates, areas with geographical restrictions, risk of climatic change effects and other factors are important in determining the insurance premium for the policyholder. If the insurance premium is high because of these factors then it is not surprising but it is an open fact that remains significant in car insurance premiums. 

3. Policy Selection

The policy selection and the types of add-on services that you choose determine the insurance premium amounts. In auto insurance policy there are two types of policies, one is a comprehensive insurance policy and the other is a third party insurance policy. The comprehensive insurance policy coverage includes many special features and advantages which are mostly suggested. 

The amount that you spend on policy selection is not going to be wasted but if you are selecting insurance that is suitable for all your requirements is useful and comes in handy when you need to add on services at the most. 

4. If car is unsafe for driving

The safety of your car is highly important in determining car insurance. The insurance evaluators decide the insurance premiums considering the safety enhancements to your car. If your car is well equipped with the best safety features then it is a deciding factor for your insurance premium. How safe is your car and how much damage it will cause post an incident all these assessments are done in determining the insurance premium. 

Some cars need a different kind of evaluation while determining the process of insurance premium. The insurance company will decide the safety of your car for driving on the roads and assess the damage in the process of evaluation. Taking all these factors into consideration, the insurance premium is decided by the insurance company. 

5. Multiple Insurance Claims

It is an incorrect assumption that an insurance policy is an investment fund. People also think that they can withdraw money from the insurance policy whenever they require it, but in reality, it is a completely different concept altogether. It is very important that you determine the expenses before making the claim. Relevant expenses and irrelevant expenses if you are able to make differentiation then you can make the right decision in making the insurance claims. 

If you are having a history of multiple insurance claims then the car insurance premium will be high. Making the right choice when to make the claim will help you to get a No-Claim bonus and also your insurance premium amount will be low. It is advised to use an insurance policy only when the claim expense is in huge amounts. If the expenses are smaller, then it is not advised to make insurance claims. 

Conclusion

The car insurance premium is costly because of the main reasons mentioned above and these may stand as hindrances in the way of determining the insurance policy. Ignoring these factors will increase your insurance premium. Consider all these factors and take measures accordingly. This will make sure that you can save a lot of money on car insurance premiums.