You may be paying a different amount for the motor insurance policy of the same car model owned by your friend in a different city. The variation in the costs or premiums for your car insurance in Kenya depend on how the car insurance is calculated. Most of the insurance companies take into consideration several key factors to determine the amount for your insurance policy.
The factors may differ for different insurance companies but the sole purpose is to calculate an estimate of how likely the insured will file a claim and how costly that claim is expected to be. Before applying for a new car insurance policy ensure you must be aware of these factors to calculate Car Insurance in kenya .
It is likely you may pay out more for the same benefits that would have costed less. Hence, it is essential you have a know-how of what sums up for your car insurance cost in Kenya. This post covers the most commonly asked questions:
- How Car Insurance Rates are Determined?
- How Car Insurance Companies Calculate Risk?
- How is your car insurance calculated?
The blog lists some of the major factors that Next Car Insurance and other insurers keep in mind while calculating car insurance costs. Read further to determine how much premium you have to pay for the car insurance policy.
1. Your age, gender and marital status
Your age is the foremost factor that the insurance company is interested in knowing. Age accounts for one of the most essential aspects while calculating the rate for car insurance. Young drivers are considered to have less driving experience at the wheel in comparison to the older ones.
Figuratively, the younger generation is taken to be more prone in causing an accident. Hence, the drivers that fall in the age between 17 and 25 are likely to pay higher premiums. It is assumed in most cases that as the drivers turn 25, the policy prices will instantly be lowered. In other scenarios, there are specific ways by which the costs can be cut short for young drivers. For student-drivers with a good driving record, the insurance company can offer special discounts on the premiums.
While considering the gender of a person, females are statistically found to be better drivers than the males, less involved in accidents and have lesser driver-under-the-influence accidents (DUIs). Hence, the women drivers are likely to pay less insurance costs.
Married couples are believed to have lower crash rates. In addition, they may be entitled to special discounts for purchasing the car insurance policy.
2. Your occupation
The occupation you are associated with has a direct impact on calculating the car insurance premiums in Kenya. A few work profiles demand more traveling such as transporting important equipment or goods from one place to another, while, in other cases, you may be driving in a high-risk or accidental-prone areas. In such cases, you are liable to pay more premium for your car insurance. Additionally, it is essential to describe your occupation and/or designation accurately.
3. The car you drive
The model and type of car that you own will largely affect the premium calculation process at Next Car Insurance. We take into consideration certain factors while determining the quote for the policy. Here’s a list of the few aspects that we keep in mind:
- Value
The more costly your car is, the more expensive will be its insurance. In case of an expensive car, the insurers will have to pay more claim, if it is stolen or has met with an accident. Also, it would cost more to repair pricier cars, specially, if their spare parts are expensive.
Contrarily, it is not always a case that economical cars would cost less to cover. Insurance coverage is not limited to the damage of the insured car, it even protects and pays for the medical expenses incurred from the caused accident.
- Power
Usually a car with a large engine and more power will result in an accident that would cost more for the insurance company. So generally, the faster your car, the higher will be the insurance costs.
- Modifications
Modifications done to the car in terms of increasing the power or making it look different, might increase your premium. However, it is essential that you notify the insurer of any modifications made to the car so that the insurance cover is not termed invalid, when you file a claim in the coming time.
- Desirability
If you drive a specific and desirable model of car, the insurance company might consider the vehicle to be at high risk of being stolen. Increasing your car’s security level can help wave off the chances of getting an undesirable vehicle.
4. Where you live?
The place where you live has a bearing on how we at Next Car Insurance calculate your premiums. If, you put up in a locality where the risk of accidents is usually greater, you’ll end up paying more for the policy. The same is applicable if, you live in an area, where cases of vehicle crime are statistically greater.
You may find a noticeable variation even between nearby postcodes. E.g. an individual living two lanes down the street may be paying higher premiums than you because their area is near to a particular dangerous locality.
5. How you use your car?
The way your car is used has an impact on determining your insurance premiums. If your car is frequently used for commuting or other purposes, the coverage plan may cost you more. In contrast, if your car is mostly parked at home and less driven on busy roads, you are likely to pay less for the plan. Here at Next Car Insurance will inquire about your car’s annual mileage before calculating the premium. It is simply like the more the car is driven, the more are its chances of being involved in an accident.
6. Your driving history and no-claims bonus
Your previous driving records and claim bonus are significant aspects that are always considered by the insurance company when calculating insurance costs. If, you have any previous made claims or have negative points on the license, this will leave a negative impact. The insurer will confirm about any claims made in the past years. Also, if it was not your fault, the claim may increase your premium costs. Similar is the case, if you have been involved in an accident that happened because of your fault.
7. Your excess
Excess is the initial amount that you are required to pay when you make a claim against the purchased policy. The more excess you are ready to pay, the less would be the car insurance cost calculated in Kenya. A direct reason behind this is that you are paying a greater amount in advance to cover up the risk.
However, if you prefer to pay no voluntary excess, an insurer will have to bear the full amount of the claim – minus compulsory excess. Hence, the insurer will charge a higher premium.
8. The type of cover you buy
There are three levels of car insurance cover:
- third-party only
- third-party, fire and theft
- comprehensive
The third party-only offers the most basic coverage for your car, where the insurer pays for the expenses incurred by the third-party involved in an accident. On the other hand, comprehensive provides an additional level of protection.
You may believe that the higher the coverage, the more expensive will be the premiums, but that isn’t always the case. It is essential you check for the quotes and benefits offered by Next Car Insurance for each type of cover, as for some of you, it may turn out to be beneficiary to opt for higher coverage.
9. Gaps in insurance coverage
Gaps in your car insurance coverage may be considered as a negative point. The insurer is likely to find it risky to cover drivers having a lapse in their car insurance than drivers who have maintained a consistent coverage. Ensure you renew your policy as soon as it expires to avoid the gaps and paying more new insurance.
