Opt for cars with safety features

Even if costlier, damage to these will be less, leading to fewer claims, lower premiums

A recent test by an independent UK-based agency showed some of the popular entry-level cars in India lacked safety features such as air bags; these had failed crash tests due to the lack of this feature.

Car manufacturers' refrain was their higher-end versions had the feature. However, this can set you back by Rs 1 lakh. Is the Indian consumer willing to shell out the extra money to make his vehicle safer?

In India, the attention to safety is still low, says Abdul Majeed, leader (automotive) at PwC. While buying a car, buyers start with pricing, fuel efficiency, look of the model and then comfort and safety. "Because the cost pressure is so much on manufacturers, they allow the customer to choose whether he or she wants features like air-bags. Most of them also reason that since they drive only in cities and not at very high speeds, they don't need air-bags," he says.

All cars manufactured in India have to meet norms prescribed under Central Motor Vehicle Rules (CMVR). Under these, seat belts are mandatory, while air bags are not, says Nikunj Sanghi, past president of Federation of Automobile Dealer's Association of India.

"The cost of air-bags can be prohibitive and they are not reusable. If one opens, it has to be refitted. That is why most car buyers opt for models without air bags,'' he says.

However, customers have started including some safety features when they upgrade their vehicles, such as read assisted parking. "The difference between a basic version and a high-end one is on account of safety, comfort and lifestyle features. These can push up the cost of the car significantly. If the government does not make in mandatory, why will manufacturers offer it?' asks Nikunj.

There is some incentive when it comes to insurance premiums for safety features, as the additional safety features will help reduce damage to the vehicle and driver, and bring down the claims. This will have some bearing on premiums in the long run, say insurers.

Insurers also give discount if your vehicle has anti-theft devices, says B J Sarma, MD and CEO, SBI General Insurance.

Insurers don't provide any special discounts for cars with air bags, since they are meant to protect the individual in case of a major accident. However, in such a case, major damage to the car is a foregone conclusion, Sarma says.

While Sarma says you can reduce your premium at the time of renewal, by adding the safety feature, according to Sanjay Datta, chief of underwriting & claims at ICICI Lombard General Insurance, it is better to buy a model with in-built safety features such as anti-theft devices or anti-skid devices.

"All cars with safety features get better ratings and hence better pricing when it comes to insurance. Hence, it is better to buy a model with safety features," says Datta.