A multi-year car insurance policy lasts for more than a year. The owner does not have to renew this policy every 12 months or 1 year. This also means that a financial cover remains intact for a longer time. First, let’s understand which aspect of a car insurance policy is mandatory.
Multi-year car insurance policies provide coverage for the car for the next 3 years or 5 years, typically. This is to offer protection against risks like accidents which may happen. In contrast, regular policies only offer one year protection. It's a great idea to get multi-year car insurance policy.
It can help you cut down the time you spend on renewing the policy one year after another. It is a long-term comprehensive car insurance plan that not only provides coverage for third-party claims but also safeguards your car against damage and compensates you for any injury or death.
This article will be about the benefits of getting a multi-year car insurance policy. You can get a multi-year car insurance policy for up to five years at a time. This is a great way to save money on your car insurance, as well as other benefits. If you are interested in finding out more about this topic, please read on.
Features:-
- Hassle-free
- No Car Inspection
- Price hike on third-party car insurance
- Control over taxes
- No claim bonus benefit
- Multiple additional benefit
- Multiple additional discounts
- Personal accident cover
- Add-on cover benefits.
Table of Contents:
Types of Multi-Year Car Insurance for 3 year old same as for 5 year old:
Third-party insurance has been compulsory for many years and is designed to protect you against any accidental expenses that happen in third party premises. You are required to take out a more comprehensive insurance policy if you want the cover of your vehicle against any loss and damage. For this, you can opt for any of the below-mentioned options.
Comprehensive car insurance plans are priced according to various factors such as the make and model of your vehicle, safety features installed in your car, the location where you live, and the purpose for which you need a vehicle.
- Comprehensive car insurance plan for 3 years.
- Third party liability car insurance policy for 3 years
- Comprehensive car insurance policy for 1 year + third party liability insurance for 3 years.
- Up to 3 years of personal accident cover of Rs 15 lakhs
- Up to 3 years of own damage cover.
- If you choose any add-ons, for example zero depreciation cover or emergency road-side assistance, they will also last for the same duration.
| Comprehensive Car Insurance |
Covers natural & manmade disasters, theft, etc. |
| Third Party Car Insurance |
Legal liability for entire duration of the policy |
| Comprehensive + Third Party Car Insurance |
Bodily injury, theft, fire, natural & manmade activities, and death |
| Personal Accident Cover |
Covers hospitalization, disability and death |
| Own damage Cover |
Covers any losses because of accident, natural calamity, or vehicle theft |
| Add-ons |
Till the end of the car insurance policy period. |
What is Multi-Year Car Insurance?
A multi-year car insurance policy is an insurance policy that provides coverage for a period of more than one year. It is also known as a long-term car insurance policy. A multi-year car insurance policy allows the insured to pay only one premium for the full term of the policy. This type of car insurance is suitable for people who want to lock in their rates over a longer period of time.
Multi-year car insurance policies are a great option for many people. They offer the opportunity to lock in rates for up to 5 years and save money on your premiums. If you have a pre-existing condition, you may be able to get a discounted rate of as much as 35% with some providers.
These policies also offer the opportunity to bundle your car insurance with other types of coverages, which can help save you even more money each year. You don't have to worry about renewing your policy every year either because it will automatically renew every year until you cancel it or change your coverage needs.
Advantages of Multi-Year Auto Insurance Policies:
- Multiyear car insurance is most convenience
- The cost is typically lower than it would be for a single year policy.
- You can choose to pay your premiums annually, quarterly, or monthly which helps make it easier to budget for them.
- You don't have to worry about renewing your insurance every year or even every two years.
- You get more coverage for your money because you are paying for more years at once and this means that you don't have to worry about increasing rates as often as you would if you were on a one year policy.
- If your car is totaled or stolen, then you will be covered with collision and comprehensive coverage.
Disadvantages of Multi-Year Car Insurance Policies:
- One of the disadvantages of buying a multi-year car insurance policy is that you can't switch to another company if you are not satisfied with the service.
- This is because, when you buy a multi-year policy for your vehicle, you are tied to the same company for at least three years.
Basic Premium Pay for Multi Year Car Insurance or Long-term Third Party Only Policy:
As per the IRDAI, the premium amount that has to be paid for your car insurance policy depends upon the cubic capacity of your vehicle. The total premium amount is determined by dividing the yearly premium by the coverage duration and adding it with the rest of the premium deposit. Here is a comparative study of the premium amounts for each stage of the engine capacity of your car.
| Capacity of the Engine |
Multi Year Third Party Car Insurance |
| Less than 1000 cc |
Rs. 4879 |
| More than 1000 cc but less than 1500 cc |
Rs. 8933 |
| More than 1500 cc |
Rs. 23908 |
*The above mentioned values are for knowing purpose do not rely on them, compare quotes and know the exact values.*
Difference Between Multi-Year Car Insurance and Single Year Car Insurance?
Multi-year car insurance and an annual or single car insurance plan are different in many aspects apart from the benefits and facilities. Have a quick look at the below table to understand the differences.
| Parameters |
Multi Year Car Insurance |
Single Year Car Insurance |
| Compulsory |
Mandatory for New Cars |
Mandatory for every car |
| Premium |
Once in every 3 years or 5 years |
Every year |
| Renewal |
Discounts available for bulk premium payments |
Regular premiums paid |
Why Multi Year Car Insurance Made Mandatory?
Multi-year car insurance policy refers to the point where instead of providing a car insurance policy with a one-year tenure, the insurer provides coverage for a tenure up to 3 years or 5 years max if you are taken the policy. With a multi-year car insurance policy, the insured does not have to renew the car insurance plan every year.
As per the order of the Supreme Court, the Insurance Regulatory and Development Authority of India (IRDAI) has mandated for all the general insurance providers of India to offer multi-year third-party insurance to the vehicles that are sold after September 1st of 2018. Moreover, it is applied on purchasing third-party vehicle insurance only, and for a comprehensive plan, owners can still purchase the policy for one year.
- You don't have to worry about your car insurance renewal even happening because you can keep it up-to-date in advance.
- You can easily port your insurer to make it available on mobile devices.
- Find a cheaper alternative to third party insurance
- India's roads were once largely inhabited by uninsured vehicles.
Who is Eligible for a Multi-Year Car Insurance Policy?
Multi-year car insurance policies are available for people who want to save money on car insurance. However, the price of the multi-year policy will be bit expensive than an annual policy over the course of time.
A multi-year car insurance policy is a policy that is purchased for at least two consecutive years. In general, the cost of a multi-year car insurance policy will be higher than that of a one-year car insurance policy. However, in the long run, it can be cheaper due to the savings on annual premiums.
In order to be eligible for a multi-year car insurance policy, you need to meet the following requirements:
- You must have had an active driving license for at least two years;
- You must have had no more than one violation in any three year period;
- You must not have been convicted of any crime or offense within the last five years;
- Your driving record has to be clean.
How Does Multi-Year Car Insurance Work?
Multi-year car insurance is a type of car insurance that covers the insured for an extended period of time. It typically lasts for two to five years and can be renewed after the initial term expires. This type of coverage is often more expensive than traditional car insurance because it saves the insurer money by reducing their risk exposure.
One benefit of multi-year car insurance is that rates are usually lower than they would be if you were to purchase traditional coverage in one year increments. Another benefit is that you can lock in your rate for the full term, which means there won't be any surprises when your policy comes up for renewal or if you want.
The 5 Key Benefits Of Multi Year Car Insurance:
- Lower Monthly Payments
- Lower Rates for Coverage
- Lower Deductibles & Premiums for Protection Plans
- Flexibility to Change Your Coverage - When needed or After a Claim is filed
- No Expiry Date for Coverage.
Best Insurance Providers that offer Multi Year Car Insurance Policy:
Conclusion:
Multi-Year Car Insurance is a type of car insurance that locks in your rates for a period of time. This type of insurance offers the best protection against future rate increases, and it’s usually cheaper than buying a new policy if you wait until your current one expires.
In conclusion, a multi-year car insurance policy offers the best value for money. They are cheaper than annual policies, and offer better coverage as well. You can save even more money by bundling your car insurance with other coverages with top leading car insurance provider.
General Queries about Multi-Year Car Insurance Policy:
Is Multi-Year Car Insurance Better or Worse than Regular Car Insurance?
Multi-year car insurance is not a new concept. The idea of paying for a fixed term for your car insurance premium is something that has been around for decades. It's a way to lock in a lower price and ensure that you have the best coverage possible.
A lot of people are hesitant about this type of car insurance because they think it will be more expensive than regular car insurance. But, this isn't always the case. Multi-year car insurance can actually be cheaper than regular car insurance if you look at the total cost over time, rather than just the monthly cost.
Who can benefit from Multi-Year Car Insurance?
Multi-year car insurance is a good option for those who are looking for coverage that is locked in at a lower rate. You can also save money on premiums by getting the multi-year coverage. If you have been driving for more than 5 years and you have an excellent driving record, then you should consider going for this option.
How much does it cost to get 5 years of protection for my vehicle?
The cost of a 5-year new auto policy varies based on the type of vehicle, the company and the coverage. It is important to know what you need to be covered in your 5-year new auto policy. The best way to find out is by getting quotes from different companies and comparing them.
Are older cars cheaper to insure?
Yes, most older cars are cheaper to insure, especially in terms of comprehensive and collision insurance. Cars lose value as they age, so the potential insurance payouts after an accident drop as well. This is not the case with many classic or collector cars.
Can I get full coverage on an old car?
You can get full coverage on an older car. It might not be particularly worthwhile, as premiums will approach or sometimes exceed the value of the vehicle.
How much car insurance do I need for an older car?
The only insurance you usually need is liability coverage and, in some states, personal injury protection. Full coverage is often recommended, but it becomes much less valuable financially with an older car.
Can I insure my car for 5 years?
Since you have paid the premiums in advance, you need not worry about renewing the insurance policy every year. All you have to do is to pay the premium once and get the freedom from the renewal of your policy for three to five years as per your vehicle.