For anyone who owns a four-wheeler, buying an insurance for it is compulsory under the Motor Vehicle Act of 1988. However, buying a four-wheeler in itself is an expensive affair. In fact, some people take loans to buy cars or two-wheelers. For them, the added expense of buying a four wheeler insurance can put a considerable strain on their finances. To overcome this issue, some insurance providers offer flexible options of paying their car insurance in full or in partial monthly payments. However, while some might view partial payment to be the easier way to make payments, others might prefer the advantage of hassle-free full payment once and for all.
So how do we decide, which payment method is better? Let us weigh the advantages and disadvantages of both these payment options to gain some perspective.
Paying In Full For Your Car Insurance
- Paying in full leads to considerable savings as compared to making monthly payments on your car insurance policy.
- The policyholder need not worry every month to remember making the payments or the car insurance plan getting lapsed
- The payment needs to be made upfront.
- A major downfall of making a full payment on your car insurance is that it becomes problematic to terminate your insurance policy or switch insurance providers during the policy’s tenure.
- Even if you do change your insurance provider, the time required to reimburse your remaining monthly premiums could get prolonged.
Paying Monthly For Your Car Insurance
- Paying in installments, helps plan your budget better.
- Monthly installments of your car insurance premium helps keep a track of your policy’s ongoing status.
- Paying monthly installments help improve your credit score.
- Most insurance providers charge certain processing fees on making monthly premium payments on a car insurance plan.
- Along with the monthly installments, some insurance providers may also ask you to pay interest on the premiums.
- You do not become eligible to make automatic withdrawals on your policy.
The final verdict
As you can see from the above details, both full and monthly payment on your car insurance have their own share of advantages and disadvantages. Ultimately, it all boils down to your personal preferences.
However, a word of caution here.
Before you make your choice, make sure you consider your financial situation. Although, full payments on your insurance can save a lot on your premium amount, for some policyholders, making monthly payments can offer more convenience.
Another factor that appears when it comes to deciding which payment mode is better for online car insurance premium is the features offered in your insurance policy. Different insurance providers offer different features as well as benefits on their four-wheeler insurance policies. Make sure you compare all the car insurance options available in the market and check out the various add-on features offered by them.
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