Does my driving history impact my car insurance rates?

There is no denying that driving a brand-new car on open highways brings a unique feeling. However, in a country like India, this joyous driving experience comes with its fair share of risks, such as potholes, disregard for traffic laws, and overspeeding. Even if you take good care of your car and try to avoid small insurance claims, your driving habits play a significant role in determining your premiums. Wondering how? Let's discuss.

Factors impacting your driving record 

1. Drunk driving 

Road safety laws strictly prohibit driving if your blood alcohol content exceeds 30 mg per 100 ml. If caught driving under the influence, you could face a fine of INR 10,000 (INR 15,000 for repeat offences), damaging your driving record.

2. Rash driving

Rash driving refers to overspeeding, changing lanes without warning, and overtaking recklessly. If you engage in these activities and are reported by either a pedestrian or another motorist to the nearest police station, and if found guilty, it will be recorded on your driving record. You will have to pay a penalty.

3. Accidents

Any road mishap involving your car resulting in the death of a pedestrian or motorist is a major negative mark on your driving record. If you are found guilty and investigations show that the accident happened because of your reckless driving, forget about your premiums — your driving license might be permanently cancelled. 

4. Traffic violations 

Traffic laws are in place to safeguard pedestrians and motorists while reducing the number of fatal road accidents. If you do not adhere to traffic and road safety laws, not only will you be penalised, but your driving record will also be negatively affected.

How does driving record impact car insurance?

While the IRDAI decides the premium for liability coverage (third-party car insurance) based on the car’s engine displacement, the cost of the own damage car insurance online depends on the probability of a claim being submitted during the policy period and the amount associated with that claim.

If your driving record shows multiple challans for overspeeding, breaking traffic signals, or drunk driving, the insurer will perceive you as a high-risk driver. That is because such incidents often lead to road accidents and significant damage to the insured vehicle, ultimately resulting in claim submissions.

A poor driving record will compel the insurer to raise the premium for your car’s own damage cover to mitigate their financial risk to some extent.

How to check driving records?

Reviewing the challans against your driving license is essential to check your driving records. Here are the steps you must take —

Step 1: Navigate to the Ministry of Road Transport and Highways’ eChallan website — echallan.parivahan.gov.in.

Step 2: Click the “Check Challan Status” tab on the homepage.

Step 3: Enter one of the following —

• Challan Number
• Vehicle Number
• Driving License (DL) Number

Step 4: Enter the relevant details and the captcha code on the screen.

Step 5: Tap “Get Detail” after entering the required information.

Step 6: Your screen will display the details of any pending challans associated with the entered information. This includes the date of the violation, the type of violation, and the amount to be paid.

Step 7: If you have any pending challans, you can pay them online through the same portal.

Step 8: You will receive a confirmation text and receipt notification after successful payment. Make sure to save or print this for your records.

How does the insurer reward policyholders for safe driving records?

Your car insurer rewards you for your good driving habits by reducing your premium by a specific percentage, known as the No Claim Bonus (NCB). Here are the details of the NCB. 

Claim-free Years NCB Percentage  

Other factors impacting your car insurance premium

• Your car’s make, model, and age influence the insurance cost. High-end, luxury, or sports cars are expensive to repair or replace, resulting in higher premiums than standard vehicles.

• The place where you live and intend to drive affects your car insurance online cost. Urban areas with high traffic, theft, or accident rates usually result in higher premiums.

• Opting for a higher voluntary deductible lowers your premium. However, in case of an accident, you will pay more out of pocket. The more the deductible, the cheaper your premium becomes. 

Conclusion

It is recommended that you regularly review your driving record to spot any issues in your driving habits. To improve your driving record and ensure affordable insurance premiums at renewal, avoid breaking traffic laws, pay your fines on time, and refrain from making small claims.

Other ways to lower your car insurance premium include avoiding aftermarket modifications, installing anti-theft devices, and purchasing a no-claim bonus protection cover.