HOW TO: Buy a Vehicle. Step1- Assess Your Needs

So you’ve decided to purchase a vehicle, congratulations. If you’re stuck on how to proceed, not to worry. We’re here to help. Take a look at these factors which will help decide your future automobile.

Price

vehicle price, automobile price, car price
Image Credit: Automedia

First things first, focus on what you need and not what you want. For example, many drivers would love to have an expensive automobile such as a Ferrari, but that’s not what you need. Look at your finances realistically, as it will dictate what you can buy. Make an allowance for automobile insurance, vehicle servicing, registration and taxes as well.

Vehicle Size

If you have more than 3 or 4 people who will be using the car, its time you looked into a bigger vehicle. Otherwise, look into a smaller automobile. These are a lot cheaper and are very reliable. In addition, newer small vehicles provide excellent protection in the event of a crash. Furthermore, unless you plan to drive long distances off road, purchasing a 4WD is quite unnecessary, as you would be better off hiring it when you need to.

Automatic or Manual

stick gear shift, manual gear shift, automatic gear, manual gear
Image Credit:Youthvillage

This one could be based on your preference, but it actually come down to your license. Yes, an automatic is a lot easier to use than a manual, but make sure that your license says that you are allowed to drive one.

Used or New

This depends a lot on your preference as there are pros and cons for both. Buying a brand new automobile means that you will have more peace of mind as you purchase directly from a dealer, however you may be able to find a bargain buy if you were to purchase your automobile from a private seller if you look hard enough.

Fuel type

This is a tricky option here. As mentioned earlier, Sri Lankans are buying greener vehicles. Look at what matters to you: Using petrol is a cheaper option, but if you wish to make an eco-friendly purchase, you could look into a hybrid vehicle as well.

Next time we will make suggestions on how you can get information about your dream car. In the meantime, share your thoughts: what type of automobile do you really need?

HNBA logo new

 

 

 

Disclaimer: The views shared in this blog are based on the macro economic conditions & industry status quo as per the time of publishing.

How does Insurance work?

Spreading the risk

As we have identified earlier, its important to have insurance. Insurance companies exist because of  the many risks in the world. We are here to help individuals like you to manage risk by ensuring that if the unexpected happens, you will be able to manage the financial burden. Insurance firms pool together the risk together of many individuals, and this helps to benefit society as a whole.

Dont put your eggs in one basket: the core of insurance
Image Credit: gettyimages

An example

For example, if 100,000 Sri Lankan’s each pay Rs 12,000 annually for automobile insurance, the insurance firm will receive Rs 1.2 billion. During the course of 2014, if 10,000 individuals suffer a loss amounting to Rs50,000 each the firm would have to pay Rs 500 million in claims, leaving the rest for future claims. Sure, if the automobile isnt yours, that money is gone. However, it is a better option to enlist a large number of people to pool together risk in order to pay for the losses of a small group, because the financial burden of Rs50000 is usually too much for one individual to manage on their own.

Different premiums

However, all motorists don’t pay the same premium. With sufficient statistical information (collected over time), insurance firms can calculate the losses the company is likely to incur, and subsequently charge each driver a different premium depending on how likely they are to be involved in a motor accident. As a result, some drivers who are deemed ‘high risk-worthy’, (ie: multiple speeding fines and accidents) are more likely to pay a higher premium than those who travel carefully and play it safe.

Right Insurance = Financial Security

Motor insurance is something which needs to be handled with care, just like you would do to your precious vehicle. If you do it right, it becomes a useful tool to maintain the financial security you deserve. If you’d like to get a motor insurance quote, send us a SMS, or simply call HNB General Insurance’s 24 hour hotline on 0114-883-883.

Note: If you are more interested in Life Insurance, call HNB Assurance on 0114-384-384 instead.

HNBA logo new

Disclaimer: The views shared in this blog are based on the macro economic conditions & industry status quo as per the time of publishing.