Updated on - 13 Feb 2026
Car insurance is mandatory in India as per the Motor Vehicles Act. With the increase in car sales, many insurers are offering lucrative insurance covers, spoiling the customer with choices. Insurance coverage for one year is mandatory when a new car is purchased. Post one year, it is the car owner’s responsibility to renew the insurance cover.
Most car owners prefer to continue with their original insurer and don’t bother to take a second look at the other, more beneficial and cheaper options, available in the marketplace. Sparing a few minutes before renewing your car insurance can yield great savings in the long term.
Importance of renewing car insurance on time
Renewing your car insurance policy on time helps avoid a penalty and ensures uninterrupted protection and financial savings. Here is why timely renewal matters:
- Avoid a lapse in coverage: A lapsed policy means your car is uninsured, making you legally and financially vulnerable.
- Protect your no-claim bonus (NCB): Timely renewal ensures you retain your accumulated NCB discount, which can significantly reduce premiums.
- No need for fresh vehicle inspection: A delay of renewal beyond the grace period may require a physical inspection by the insurer, adding hassle and potential costs.
- Legal compliance: Driving without valid insurance is a punishable offense in India.
Factors that affect your car insurance premium
Understanding what goes into calculating your premium is the first step in saving money. Several variables play a role:
- Type of insurance: Comprehensive car insurance offers broader protection compared to third-party plans but comes at a higher cost.
- Vehicle details: Age, model, fuel type and engine capacity affect the Insured Declared Value (IDV), influencing your premium.
- Geographical zone: Premiums differ based on where you register your vehicle; high-traffic urban areas usually attract higher premiums.
- Driving history: A clean, claim-free record helps you earn NCB discounts, lowering renewal costs.
- Add-ons and voluntary deductibles: Add-on covers increase premiums, while a higher deductible can bring them down.
Tips to save money while renewing car insurance
Here are a few aspects that you must look into before renewing your car insurance to save money.
- Car insurance policy comparison
Most people might be tempted to just go with their current insurance policy, as that seems to be the most convenient and hassle-free way to get things done quickly. However, there is also the possibility that the insurer has made revisions to the terms and premium calculations.
It is always better to browse through the premiums charged by other providers. This is not a time-consuming process as there are hundreds of websites available that let users compare different car insurance policies online. A little research on your end can save you valuable money over the period of coverage.
A little calculation of the current value of your car, taking into account the depreciation factor, can save you a lot of money on your premiums. Once the depreciated value of the car is known, it only takes a little negotiation with your insurance agent to gain big on premiums.
No claim bonuses (NCBs) are awarded to policyholders who do not make a claim in the preceding year. Claiming this bonus before renewing your policy can result in lower premiums for the next year. It doesn’t matter whether your insurer is the same or different, as NCBs are transferable from insurer to insurer. Over the years, NCB can lower the premium amount by as much as 50%.
It is highly recommended to go through the features of the car insurance policy you’re renewing. In doing this, you might come across features that were offered last year but are no longer present this year. You may also see features that you don’t need this year and there might be some you want to add this year. Going through such details helps you get only those benefits you want, at a price that does justice to your wallet too.
Renewing your policy beforehand is always beneficial. Experts have recommended renewing the policy at least 45 days before it expires. This ensures that you enjoy the benefits of coverage without a break and also saves you from a hike in prices that may occur later on.
Role of online car insurance renewals in saving money
Renewing your car insurance online is not only convenient but also cost-effective. Here's how it helps:
- Access to discounts: Many insurers offer exclusive discounts for online renewals.
- Transparent comparison: Easily compare multiple policies in one place to find the best deal.
- Lower operational costs: No middlemen or agents means reduced overheads, resulting in cheaper premiums.
- Quick and paperless process: Save time and avoid documentation hassles with seamless digital renewals.
Understanding add-ons: which ones are worth paying for?
Add-ons enhance your coverage, but choosing the right ones is crucial to avoid overspending. Some worthwhile options include:
- Zero depreciation cover: Highly recommended for cars under 5 years old, this ensures full claim without depreciation deduction.
- Engine protection: Beneficial if you live in flood-prone or waterlogged areas.
- Roadside assistance: Useful for frequent highway drivers, offering services like towing and on-site repairs.
- Return to invoice: Covers the full invoice value in case of total loss or theft, ideal for new cars.
Evaluate your car’s age, usage and location before selecting any add-ons with your comprehensive car insurance plan.
Importance of reviewing policy terms before renewal
Many people ignore reviewing the policy and end up with irrelevant coverage or missed savings opportunities. Here’s what to review:
- Coverage scope: Make sure your current plan still aligns with your needs.
- Changes in IDV: Adjust your vehicle’s IDV if needed to reflect accurate market value.
- Add-on suitability: Remove unnecessary riders to cut costs.
- Exclusions and inclusions: Understanding them can prevent surprises during claims.
Conclusion
Renewing your car insurance does not have to be a burdensome or expensive task. With a little research, timely action, and the right tools, you can save a substantial amount on your premium while ensuring robust protection. From leveraging your NCB to opting for only essential add-ons, each choice matters. Embrace the convenience of online renewals, review your policy carefully and drive with confidence, knowing you’ve made a smart and cost-effective decision.
FAQs
1. Can I switch insurers during car insurance renewal?
Yes. You are free to switch insurance providers at renewal time to get better coverage or pricing.
2. Does renewing online offer the same benefits as offline?
Yes, and often more. Online renewals may include discounts, faster processing and easier comparisons.
3. How much NCB can I get at renewal?
Depending on your claim-free history, it is possible to get a 50% discount at the time of renewal.
4. What happens in case I miss the policy renewal date?
You risk a policy lapse, NCB loss and possible legal consequences. Always renew before expiry.
5. Is comprehensive car insurance better than third-party?
Yes, if you want to protect your vehicle from theft, accidents, fire or natural disasters, you must opt for comprehensive insurance.
Disclaimer: The information provided in this blog is for educational and informational purposes only. It may contain outdated data and information regarding the Insurance industry and products. It is advised to verify the currency and relevance of the data and information before taking any major steps. ICICI Lombard is not liable for any inaccuracies or consequences resulting from the use of this outdated information.