Introduction
The older a car is, the higher the risk of damage or loss, which directly impacts insurance premiums. This article focuses on how car age affects insurance premium rates, discussing the factors insurers consider and providing tips for drivers to manage costs without sacrificing coverage.
1. Car Age Factors and Premiums
- New cars usually enjoy lower premiums due to lower risk of damage.
- Cars aged 5–10 years tend to have moderate premiums, depending on the type of coverage and NCD history.
- Cars over 10 years old generally face higher premiums, especially for comprehensive policies.
- Note: Some insurers have maximum age limits for offering full comprehensive coverage.
2. Specific Risks Based on Car Age
- Frequent mechanical breakdowns: Older cars are more prone to faults, leading to higher claims.
- Limited spare parts availability: Some older imported cars require costly repairs.
- Lower market value: Insurance calculates loss based on car value, so older cars may be under-insured.
3. Smart Tips to Manage Premiums for Older Cars
- Consider third-party coverage or limited comprehensive policies to save costs.
- Maintain NCD consistently to maximize discount on premiums.
- Check suitable BJAK add-ons: VIP Rescue or Warranty can help reduce additional risks.
- Compare premiums from different insurers for cars of similar age.
Conclusion
Understanding how car age affects insurance premium rates allows drivers to make informed decisions when buying or renewing coverage. By assessing risks, maintaining NCD, choosing suitable policies, and checking BJAK add-ons, you can ensure optimal protection without overspending.
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