On-time renewal saves you from any kind of legal or financial implications and saves both time and mental stress
In India, if anyone is found to drive on the streets without a valid car insurance plan, then they have to face certain financial and legal issues. As per the Motor Vehicles Act, any car on public roads must be covered by at least a third-party cover and should always be covered no matter what.
Policies that are not renewed within the stipulated period of time are considered invalid or lapsed policies. Claims of such expired plans are not entertained either by any insurer. Moreover, if one forgets to get their expired insurance renewed, then this could be another issue as it would violate the motor laws, and the driver might have to pay hefty fines or even go through some legal procedures.
In this article, we will walk through certain factors which will help you understand why you need to renew your car insurance on time.
To avoid paying higher premiums
If your car insurance policy has lapsed due to non-renewal, then renewing such a plan or buying a new plan can lead to paying premiums on the higher end. Moreover, renewing the policy after the due date can be critical because of the different procedures one has to go through as per their insurers. One must try to avoid such situations by renewing their policies on time. There are certain insurers/insurance brokers who offer digital reminders to the insured to get their renewals done on or before time.
To ensure a seamless renewal process
There is a high probability of your car getting inspected if you try to renew the car insurance policy after a gap, and such inspection might create unnecessary hassle to the insured. Also, the discovery of any damages during this inspection process might result to reduced Insured Declared Value (IDV). In order to avoid such situations, one should renew the policy on time and ensure a hassle-free process.
To avoid legal issues
Having an expired car insurance plan is as good as not having one. So, if you are the one who is driving on the streets without or with an expired car insurance plan, then you ought to undergo certain procedures when caught by traffic officials. Things could get even worse if your car gets damaged or you get injured as all the expenses will fall under you and might burn a big hole in your pocket.
To ensure continued coverage
Renewing your car insurance policy on time can help you recover any financial liabilities arising from your car due to unfortunate situations. Moreover, the continued coverage helps to avail other benefits like No Claim Bonus, cashless repair facility, coverage for a damaged vehicle, third party property, self-injury, etc.
To prevent loss of No Claim Bonus (NCB)
No Claim Bonus, also known as NCB, is provided by the insurance company to the insured for not raising any claim during the policy year. The benefits of No Claim Bonus are only applicable if the renewal is made on time. If the policy is not renewed within the expiry day of the plan, then this benefit becomes invalid to the insured.
On-time renewal is extremely significant as it saves you from any kind of legal or financial implications. Moreover, renewing the policy before the grace period helps avoid other liabilities and saves both time and mental stress.
The author is Director, Probus Insurance
DISCLAIMER: Views expressed are the author's own, and Outlook Money does not necessarily subscribe to them. Outlook Money shall not be responsible for any damage caused to any person/organisation directly or indirectly.