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Voluntary Deductible-Option For Saving Car Insurance Premium?

We all know that how much car insurance is a necessary thing from the perspective driving a four wheeler on Indian roads and keep you favourite drive in the best possible condition.This is a fact which everybody needs to appreciate because while buying a car you are buying into something the value of which keeps on depreciating each year so investing further  for repair and damages is something that is not worth of doing so and this where your car insurance policy comes as great help.

Buying the right car policy not only requires a good amount of research but you should be smart enough to understand which addon to opt for and how can one save money on premium or otherwise you will always end up buying a plan which would be a complete mismatch to your needs and you might end up paying a higher premium,not worth of paying.


There are other mistakes which people end up making while being super obsessed towards savings money on premium, policyholders select some options which might give the initial discount while buy best car insurance policy online but which deeply affect you while making claim, one of them is when people voluntary deductions. To understand the worry it can create let’s first what voluntary deduction is ?

A deduction means an amount of money which a policyholder commits to pay from his/her own pocket at any point of time if a situation of claim arises.In any comprehensive car insurance policy there are two types of deductions which are available:

a)Compulsory deduction , this particular deduction is pre-fixed in any car policy.The insurance regulator sets the rate for the same. As per the current rates, the compulsory deduction is Rs.2000 if the car has more than 1500 cc engine or otherwise the rate is Rs.1000.

b)Voluntary deduction, this particular deduction is something which the policyholder himself accepts to pay. In a case like this insurer always incentivize the policyholder with certain percentage of discount on premium. A clear view of the table below can give you a clear idea of discount one can get avail

Amount of Voluntary deduction

Discount on Premium


20% on the own damage premium, subjected to a maximum amount of Rs. 750


25% on the own damage premium, subjected to a maximum amount of Rs. 1,500


30% on the own damage premium, subjected to a maximum amount of Rs. 2,000


35% on the own damage premium, subjected to a maximum amount of Rs. 2,500


The discount may look very attractive initially but the real problem starts when you make claim. In most of the cases you end up paying 50% of the claim out of your own pocket which defies the reasons why you bought the car policy.

To understand this in detail, take the case of Varun who drives a 1000 CC car and faces an accident.The claim that he end up raising with his insurer is Rs.15000 which was paid during repairs but to his astonishment his insurer only paid him Rs.7000. This is a classic case when you become super obsessed on discounts while renewing a policy.

Calculation for Varun’s claim:

Total Claim Varun’s raised (A)


Consumable parts and components deduction (B)


Compulsory deductible Amount (C)


Voluntary deductible Amount (D)


Total claim paid by the insurer [A – (B+C+D)]




The above is a classic case, while opting for voluntary deductible to get few rupees of discount initially led Varun to pay Rs.8000 out of his own pocket. He forgotten the facts no insurer covers the fiber and plastic parts of the car and even there is a concept compulsory deduction’s one should always keep in mind less price means cheaper returns and that applies to a car insurance policy also.