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CNG Kits and Car Insurance: The True Connection

CNG CNG Kits and Car Insurance_ The True Connection - (A)

Gasoline and diesel are expensive. Both have their pros and cons. It just makes it difficult for you to choose a car with the best variant, doesn’t it?

Compared to CNG, you will find that there is a marked difference between its prices. CNG (Compressed Natural Gas) certainly wins every day!

If you drive regularly, you will find that CNG is more economical and environmentally friendly in the long run.

However, this affects your auto insurance premiums. How and why?

Let’s get to the bottom of the problem!

What you did not know about CNG?

First, let’s talk about the benefits:

Better efficiency and better mileage

After installing the CNG kit, you will see a significant improvement in your car’s mileage. Less fuel is required for the same distance. Also, CNG costs about half or more than half that of gasoline. It is not bad to save around one thousand rupees a month on fuel bills. Without a doubt, CNG is much more efficient.

More security

Do you want security and profitability? CNG promised to be a safer alternative to gasoline and diesel. It is not flammable and emits less carbon dioxide, which makes it environmentally friendly.

Effective cost savings

The initial cost is high, which is actually a disadvantage. However, the good news is that it can be restored quickly in a few months.

Let’s go to the cons:

It takes up too much space in the trunk

A CNG kit can hold up to half of your trunk. It depends on the size of your car. If you like long trips with a lot of luggage, avoid the CNG kits.

Not available immediately

Not all service stations offer CNG. This means you have to have long questions with rickshaw drivers when you need to refuel. The filling can take up to 15 minutes.

Convertibility and licenses

Not all of the cards are compatible with the CNG fuel system. You will need regulatory approvals before installing the kit. A series of procedures include obtaining the Certificate of Registration (RC), which is marked with a seal to change the fuel. Post that you can use the CNG kit.

How does this affect your auto insurance?

Existing coverage will not be enough

If you plan to install a CNG system in your car, the work doesn’t end there.

You might think that the existing coverage is adequate. Maintenance and damage costs are higher with CNG kits.

As the kit is installed, so do your coverage and premiums.

 You must notify the insurer, who will be charging an additional premium.

Insurance companies consider CNG cars to be riskier. You will have to pay an additional Rs 60 for your car liability insurance to CNG. This is in line with the Indian car rate, which sets the rates for auto insurance premiums.

The premium is usually 4 to 5% of the value of the CNG kit. In fact, the premium also depends on the age and the model of your car. It could go up to 10%.

Some insurers may ask you to register the CNG kit in the vehicle registration document.

 Your insurance contract generally contains a CNG conversion clause. Installing a CNG kit works as a major modification of the car.

It must be added to your insurance policy. Its malfunction affects the entire car and is therefore treated as indirect damage. Consequential damages are generally excluded from the insurer’s list of exclusions.

To ensure the kit, you will need confirmation from your insurance company of your auto policy. Failure to do so will void your entire policy.


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