How Your Fuel Impacts Car Insurance Premium

There has been a never-ending debate on which type of fuel is best for a vehicle in the long run. You might be unaware of the fact that the fuel used in a vehicle does have a considerable impact on the premium of your vehicle along with the Insured Declared Value and various other factors. A little research regarding the same will help you understand the reason why the car insurance premium for a petrol vehicle is lesser than that for a diesel or a gas fitted vehicle. Diesel cars are expensive and are generally driven for longer distances while CNG fitted vehicles require higher maintenance and a high installation cost.

If you are willing to install a CNG kit in your vehicle then you should be conscious of the rules and regulations to be followed in order to upgrade your car insurance policy. If you are opting for CNG installation in your existing vehicle then your car should be covered by a motor insurance policy, be it a comprehensive car insurance or just third party insurance. If you If you fail to follow the procedure, you may have to suffer the consequences. Your insurance company will not entertain any claim in future.

Car insurance premium is determined mainly on the basis of cubic capacity of engine, Insured Declared Value (IDV), fuel type of the vehicle and various other add-ons that the owner might have opted at the time of purchasing the car insurance. The insurance premium to be paid for a new pre-fitted CNG vehicle is maximum as compared to the insurance premium of the same car operated through any other fuel. However, if you have got a gas kit installed in your old car, the premium difference could be substantial.

The experts propose that car insurance companies also consider various factors based on the vehicle and the driver to determine the cost of car insurance. One of the crucial factors in determining the car insurance cost is the price to repair the vehicle in case of damage. This is where diesel car’s high initial cost really presents a distinct disadvantage.

In short it all comes down to which fuel powers your vehicle, be it petrol, diesel, gas operated or hybrid. Eventually it also comes down to repairing cost of the vehicle in case of damage. Repairing a battery operated car can come down to be more expensive as compared to any other fuel.

Other major factors that play crucial role in determining car insurance premium rates are the age of the vehicle, model and the price at the time of purchase.

Leave a Reply