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The Impact of Installing Anti-theft Device on Car Insurance Premium

By Vikas Chandra Das
21 July 2022, 11:46 AM

Car insurance premiums have only seen an upward trend as the years pass by. However, as a vigilant policyholder and car owner, there are certain measures that can be taken in order to reduce the premium amounts of your car insurance policy such as utilising discounts, purchasing policies online, opting in for a pay-as-you-go insurance policy, etc.

This article will discuss one such measure that can be taken to reduce your car insurance premium i.e. installing anti-theft devices in your car.

What are the Benefits of Installing an Anti-theft Device?

An anti-theft device keeps one’s car secure using a range of technologies available. The benefits that one will avail by virtue of installing anti-theft devices (ATDs) are as follows –

  • Stopping theft – the presence of an anti-theft device can provide enough buffer time for some action to be taken to prevent the theft from occurring. In fact, it can even deter the thief from attempting to target your car in the first place.
  • Discount on car insurance premiums – if the policy that is being purchased is a comprehensive car insurance policy, then one must proactively inform the insurer of the purchase and installation of ATD in the car. Just like what Akash did when he installed the anti-theft device in his car and informed the same to his insurance company. Hence, got a discount on his next policy premium.
  • Easy claim settlement – having taken all the reasonable measures that you could have taken to secure the safety of your car, any claims in the future will be processed seamlessly as the insurer is aware that you could not have done anything more to prevent the theft of the car.
  • Avoiding inconvenience – you can avoid the inconvenience and troubles associated with visiting the police station to file an FIR, filing the claims with the insurer, etc. by taking a proactive step of installing an anti-theft device.
  • Financial safety – the amount that you will receive from the insurance company will be the Insured Declared Value (factoring in the deductibles and depreciation), which will not be the same as having one’s car. You would rather do all that is within your power to prevent the occurrence of the event rather than take steps once it has happened.

What are the Different Anti-theft Devices that You can Install?

  • GPS tracking will help one trace the real-time location of the stolen vehicle.
  • The car alarm will warn the car owner through an audible warning sound about any tampering of the vehicle.
  • Electronic immobiliser with built-in transponders that send a signal to the ignition and the fuel system rendering the vehicle inoperable.
  • Mechanical immobilisers, which are relatively inexpensive devices, are used to stop the mobility of the car. Examples are tyre locks, gear locks, steering locks, etc.
  • A kill switch is used to switch off a part of the engine rendering it immovable. The kill switch must be placed in such a manner that the thieves will find it hard to locate.

What is the Impact of the ATDs on Car Insurance?

Car insurance companies offer a discount of 2.5% on the premium to a maximum of INR 500 if the vehicle is fitted with an approved anti-theft device. However, this discount is available only for own damages and not for a third party cover. 

The anti-theft devices need to be certified by the Automotive Research Association of India (ARAI) to avail of the anti-theft discount for the car insurance premium.


The presence of an anti-theft device that is certified by the ARAI is an added advantage to the car for it not only enhances the car’s security, but it also helps one gain several other benefits – the prime one being a reduction in the premium of the car insurance policy.

Invest in one if you feel that the advantages of having one are worth the price.


1. What is the cost of ATDs?

The cost of the device is entirely dependent on the technology that goes into it. For example, a basic alarm can cost one anywhere between INR 3,000 to INR 4,000, whereas, a GPS or an Anti-theft system (ICAT) will be between INR 6,000 to INR 17,000.

2. When should I inform the insurance company about the ATDs?

The insurer must be informed about this modification immediately after doing it in order to avail of a reduction in the premium amount.

3. Do new cars have built-in ATDs?

The latest models come with anti-theft devices built into the system especially, if it were to be a luxury car by Toyota, Mahindra, Ford Motors, etc. Some mid-segment cars also come in with anti-theft devices. Insurers prefer this feature to be mandatory to ensure that the cost of honouring claims will be reduced.

4. Is it mandatory to install ATDs?

It is not mandatory, but installing ATDs comes with a lot of benefits as highlighted above.

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