How Do You Define a Cheap Car Insurance Policy?

Affordability in car insurance doesn’t just mean paying a lower premium, it means getting the right coverage for your specific needs without compromising on quality. A truly affordable policy should include not only the mandatory third-party liability cover under the Motor Vehicles Act but also offer own-damage protection against risks like accidents, theft, natural disasters, and fire. The goal is to strike a balance between meaningful protection and cost-efficiency.

With TATA AIG, car insurance plans start at approximately ₹2,094 per year (depending on the car model, location, and selected coverage). You can customise your policy with a wide range of useful add-ons such as Zero Depreciation, Engine Secure, Roadside Assistance, Emergency Transport & Hotel Expenses, and Key Replacement. These options help ensure that your coverage stays relevant, while your premium remains within your budget.

There are several factors that have a bearing on your car insurance price. Here are some of these factors:

Car Age and Coverage

The age of your car is an important factor in the determination of your car insurance price. This is because new cars have a higher Insured Declared Value (IDV) as compared to old ones. Therefore, the car insurance premium calculated as per the vehicle's IDV shall be higher for new cars than old ones. Furthermore, since the components of new cars can be hard to replace, their car insurance online rates tend to be high.

The Type of Coverage

Another significant factor that drives the magnitude of your car insurance price is the type of coverage you opt for. Select a comprehensive car insurance policy. You may have to pay a higher premium than for, say, a third-party liability insurance policy or a standalone own-damage insurance plan. However, despite a higher cost, it is recommended to opt for a comprehensive car insurance policy for your car.

Type of the Car and its Features

The higher the cost and technical features of your car, the higher is the corresponding car insurance price. This is why high-end cars, including luxury cars and sports cars, usually have a higher car insurance premium than low and medium-budget cars with basic specifications.
The lack of sufficient availability of the parts of high-end cars also drives a rise in their premium. However, it is important to note that the installation of safety features can help you get a lower car insurance rate. If you install any safety equipment, for instance, an anti-theft device, to your car, it becomes safer and less prone to theft. Therefore, the corresponding car insurance price shall get reduced.

Deductibles

Your car insurance deductible is the part of the claim you have to pay out of your pocket. The deductible for your car insurance plan is determined at the time of the purchase of the policy. As a general rule, the higher the deductible, the lower is the car insurance price.

Instead of looking for the cheapest car insurance in India, you must prioritise car insurance plans that offer adequate coverage at a feasible price. Keep in mind the fact that the cheapest car insurance may not be the best car insurance.

The Selected Add-on Benefits

There are several car insurance add-ons that you can select to enhance your car insurance policy coverage. These add-on features include a Zero Depreciation cover, consumables expenses, etc., enabling you to have a higher degree of financial protection for your car. However, since each add-on carries a specific cost, their inclusion in your car insurance policy leads to an increase in the car insurance price.

Although it is tempting to opt for cheap car insurance, it is advisable to select a car insurance policy that provides sufficient protection in alignment with your specific car insurance requirements.

Some of the other factors that determine your car insurance price have been discussed below.

• Geographical Location

The geographical location you live in is also a critical factor in determining your car insurance price. If you live in a place that has uneven terrain and is prone to accidents, the car insurance rates for cars to be primarily driven in that region shall be high.

Similarly, areas with heavy and low constant rainfall tend to have high car insurance rates. Furthermore, if the area you live in has a high incidence of crime, including theft, you are likely to have a higher car insurance rate than, say, a person who lives in a relatively low-crime area.

• The Usage of the Car

The purpose for which your car shall be used is also a key determinant of its car insurance price. Therefore, the car insurance rates of commercial vehicles and passenger vehicles are different. Therefore, it is important to declare the intended use of your car while purchasing a car insurance policy.

• Your Car Insurance Claim History

If you have a history of frequent car insurance claims, it reflects poor driving, non-compliance to traffic rules, or a combination of the two, leading to an increase in your car insurance price. Since a high incidence of car insurance claims makes you a high-risk customer for car insurance companies, the corresponding car insurance premium would increase.

Another drawback of a high frequency of car insurance claims is that you miss out on earning a No Claim Bonus (NCB) on your policy which is a reward that insurance companies provide to policyholders who do not make any car insurance claims within a policy year. With an NCB, you can claim a discount of 20 per cent on the premium of your car insurance policy during its renewal.

Furthermore, suppose you make a car insurance claim in a policy year after accumulating an NCB in your car insurance policy during the preceding year. In that case, you lose that accumulated NCB and have to start your NCB qualification afresh.

If you are trying to find out the most affordable car insurance in India, take a moment to consider the many pitfalls of buying low-cost car insurance. Some of these pitfalls are:

• Fewer Add-On Options in Basic Plans

Basic policies may not include add-ons such as Zero Depreciation, Roadside Assistance, Key Replacement, or Engine Secure, which can significantly expand your protection. While such covers might not be bundled with entry-level policies, TATA AIG allows you to upgrade and include these valuable add-ons at the time of purchase or during renewal, offering flexibility without needing to compromise on coverage.

• Lack of Add-on Covers

One of the drawbacks of buying a low-cost car insurance policy is that it offers a basic car insurance cover with no add-on benefits. However, the importance of car insurance add-ons such as Roadside Assistance, Zero Depreciation, etc., cannot be overstated since they enhance your car's insurance coverage to a significant degree.

Furthermore, if you forget to include a particular add-on while purchasing your car insurance plan, you can include it during the policy renewal. However, this is not applicable in affordable car insurance renewal as such plans offer no add-ons.

• High Deductible

Some low-premium policies may include a higher voluntary deductible to keep premiums down. This means you’ll have to pay more out of pocket during a claim. While this approach can reduce your annual premium, it’s important to weigh the savings against the potential out-of-pocket cost if a claim arises. Not all low-premium plans include high deductibles. TATA AIG offers options to tailor your deductible preferences so you can find a balance that works best for you.

Rather than looking for a cheap car insurance policy that is likely to end up being anything but cheap in the event of you filing a car insurance claim, it is better to reduce the premium of a regular car insurance policy.

Here are some tips to help you reduce your car insurance premium.

• Choose the Insurance Coverage Wisely

Always select your car insurance policy only as per the protection your car needs. A basic third party car insurance is very affordable when compared to an own damage cover or a comprehensive policy. Therefore, the premiums you pay only to protect your car from third-party damages will be quite low.

However, comprehensive car insurance can also be cost-effective if you choose the Insured Declared Value of your car correctly. Hence, by choosing an appropriate IDV, you can pay reasonable premiums in return for extensive coverage for your car.

• Opt-Out of Coverages That You Don't Need

While selecting car insurance add-ons, it is easy to get carried away and select some benefits that you probably do not need or will end up never availing of. Therefore, it is important to remember that each car insurance add-on has a price attached to it that drives an increase in your overall car insurance price.

There is no point in paying for benefits that are not necessary for your car. Hence it is advisable to choose only the add-ons that you deem are required for your car so that you establish a substantial balance between your car insurance premium and the coverage provided by the policy.

• Avoid Making Minor Claims

Remember to be extremely careful about how you use your car insurance policy, particularly with regard to claims. Suppose you file a car insurance claim for every minor damage sustained by your car. In that case, you will not be able to accumulate a No-Claim Bonus on your car insurance policy which can help you get a reduced car insurance rate during the policy renewal.

Therefore, you must refrain from filing car insurance claims for minor damages such as a broken rearview mirror or a scratch on the car's number plate.

• Install Safety Features in Your Car

One of the easiest ways to reduce your car insurance premium without having to resort to a cheap car insurance policy is by installing certain safety devices in the vehicle. By taking the path of prevention is better than cure, you qualify as a low-risk customer, which can help you get a reduction on your car insurance price.

There are several safety features that you can install in your car to make it safer, including anti-theft devices and airbags. These features help keep you and your car safe whilst sparing you from looking for cheap car insurance quotes.

• Stay Away from Making Car Modifications

If you opt for any modifications to your car that enhance its aesthetic appeal, you will likely have to shell out a larger sum by car insurance premiums. Since modifications such as alloy wheels are expensive, so is their inclusion in the coverage of a car insurance plan. Therefore, you must refrain from the addition of any such equipment to your car.

• Choose a Deductible That You Can Pay Easily

Selecting the adequate deductible for your car insurance policy is akin to walking a dangerous tightrope. If you opt for a low deductible, your car insurance premium ends up being high, whereas a high deductible would mean that you will have to bear a high percentage of any financial losses pertaining to your car in the event of a total loss event.

Therefore, you need to consider your financial situation carefully and the car insurance coverage you require before determining your car insurance deductible.

There are several benefits of buying four wheeler insurance for your car. Some of the key benefits of a car insurance policy are:

Buy Policy Online

Buying car insurance online saves both time and money. With Tata AIG, you can get a quote in just 2 clicks. You also benefit from discounts—up to 85% off when insuring a new vehicle, or up to 75% off if you’re switching from another insurer with an older car. The online process is quick, paperless, and available 24/7.

Customisation With Add-on Covers

Every driver’s needs are different, and that’s where add-ons come in. By choosing add-ons like Zero Depreciation, Engine Secure, Roadside Assistance, Tyre Protect, or Consumables Cover, you can tailor your policy to better suit your driving habits. Add-ons do come with an extra cost, so it’s best to choose only those that add real value for your usage.

Wide Network of Cashless Garages

Having access to repair services when you need them is crucial. Tata AIG offers access to 5900+ cashless garages across India. This means you can get your car repaired without paying upfront—the garage settles directly with your insurer, and you just pay any applicable deductible. This helps reduce both stress and delays during claims.

Easy Claims Process

Filing a claim should be straightforward and stress-free. With the online claims process available today, you can register and track your claim from the comfort of your home. Whether through the website or mobile app, the process is designed to guide you step-by-step. In case you need assistance, support teams are available to help clarify documentation or guide you through the next steps—making the claims experience smoother and faster.

Comprehensive Security for Your Four-Wheeler

A comprehensive policy gives your car protection not just against third-party liabilities but also against damage from accidents, theft, fire, floods, and other natural or man-made events. Personal Accident (PA) cover can also be included or bought separately, depending on your policy. This well-rounded coverage ensures you’re protected in most situations on the road.

A comprehensive four-wheeler insurance policy gives you complete protection from unexpected costs due to damage, theft, or accidents. Here's a breakdown of what it usually covers:

• Theft or Total Loss of the Car

If your car is stolen or completely damaged beyond repair due to an accident, the policy pays you the Insured Declared Value (IDV). This amount is based on your car’s current market value and helps you recover from the loss.

• Damage Due to Natural Disasters

The policy covers expenses if your car gets damaged due to natural events like floods, earthquakes, cyclones, or snowfall. These can cause serious issues, and having this protection saves you from paying high repair bills.

• Damage Due to Fire or Man-Made Events

You’re also covered if your car is harmed due to fire, riots, strikes, vandalism, or even terrorist acts. These events are unexpected, and the policy helps you manage the cost of repairs without stress.

• Damage from Accidents

Whether it’s a minor bump or a major crash, this policy takes care of repair costs. It’s helpful because accidents can happen anytime, even if you’re careful on the road.

• Damage During Transit

If your car is being transported—by road, rail, or any other means—and it gets damaged in the process, the policy covers the repair expenses. This is useful if you move cities or send your car for long-distance servicing.

• Third-Party Liability

If your car causes damage to someone’s property or injures another person, the policy helps you handle the legal and financial liabilities. This is a mandatory part of the insurance and protects you from paying out of pocket.

• Personal Accident Cover

In case of injury or death of the car owner due to an accident, the policy provides financial support. It also covers emergency medical treatment and hospital travel costs, easing the burden during tough times.

1. Compare Plans Online

Compare quotes from different providers to find affordable car insurance. Make sure the plan meets the required coverage standards. With TATA AIG, you can get instant quotes in just 2 clicks, making it easier and faster to compare policies.

2. Opt for Essential Cover

Stick to the mandatory third-party cover or choose a basic comprehensive policy. This keeps costs low while still protecting your vehicle.

3. Increase Voluntary Deductibles

By choosing a higher voluntary deductible, you can lower your premium. TATA AIG offers flexibility in this area, helping you manage your premiums more effectively.

4. Maintain a Clean Driving Record

Having a clean driving record can help you get No Claim Bonus (NCB), which reduces the cost of your insurance when you renew.

5. Use Online Discounts

Many providers, including TATA AIG, offer special discounts when you buy or renew your policy online. TATA AIG also offers up to 85% discount when purchasing car insurance for new vehicles, helping you save money.

6. Avoid Unnecessary Add-ons

Only choose add-ons that are necessary for your car. Extra features can increase your premium, so stick to the basics unless you really need them.

7. Renew Your Policy on Time

Always renew your policy on time. This helps you avoid premium increases and ensures your coverage doesn’t lapse. Additionally, TATA AIG offers a 75% discount on rollover policies for higher-age vehicles, which can significantly reduce your renewal costs.

Buying affordable car insurance online is simple and hassle-free. Just follow these easy steps to get started:

Step 1: Visit the Official Website

Head over to the insurer’s official website. If you’re insuring a brand-new car, look for the option that says something like ‘Buy New Car Insurance’ or ‘Get Quote’ to begin the process.

Step 2: Enter Vehicle Details

You’ll be asked to fill in your car’s make, model, variant, fuel type, and registration location. For a new car, you may also need to provide the expected delivery date to get an accurate quote.

Step 3: Share Basic Info

Next, enter your mobile number, PIN code, car delivery date, and RTO details. These help the system calculate your premium based on your location and vehicle.

Step 4: Pick Your Policy Type

Now, choose between a third-party or comprehensive policy depending on your needs. You can also customise the plan by selecting add-ons like zero depreciation, engine cover, or roadside assistance.

Step 5: Add Personal Information

Fill in your basic details such as name, date of birth, address, and email ID. You may be asked to complete a CKYC (Central KYC) process if it hasn’t been done already.

Step 6: Include PA Cover Details

If you want to include a personal accident cover, provide your car’s engine and chassis number, mention any loan hypothecation details, and add nominee details. PA cover is mandatory but can be bought separately if you already have it under another policy.

Step 7: Make the Payment

Once everything is filled out, make a secure payment online through your preferred mode. After the payment is successful, your policy will be issued instantly.

Step 8: Get Your Policy

You’ll receive your car insurance policy on your registered email ID. You can also download it directly from the website or scan it using the QR code provided on the screen.

Disclaimer / TnC

Your policy is subjected to terms and conditions & inclusions and exclusions mentioned in your policy wording. Please go through the documents carefully.

your car with all-around protection against unforeseen perils. Yes, you guessed it right — the extraordinary Comprehensive car insurance!