Renewing your motor insurance on time is important to cushion both yourself and your vehicle in the event of unforeseen incidents. If you meet with an accident when your policy has expired, the insurer would not be liable to pay the insurance claim — which means that you would have to bear the entire cost of damage.
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Besides, according to the Motor Vehicles Act, 2019, third-party motor coverage is compulsory in India. Driving your vehicle without a third-party cover may attract a fine of Rs 2,000-Rs 4,000 or even lead to imprisonment of up to three months.
"Another important thing to keep in mind is the loss of no claim bonus (NCB). If you fail to renew your policy up to 90 days of policy expiry, you will lose out on the NCB offered by the insurer. The NCB discount helps in reducing your premium by 20-50 percent. Also, if there is a long break in your policy, insurers in some cases may refuse to renew the insurance policy or impose a huge penalty or fine," Kunal Jha, Head at Motor Product and Actuarial, Digit Insurance, told CNBC-TV18.com.
How to renew your motor insurance post-expiry date
If you fail to renew your motor insurance policy on time, reach out to your insurer as soon as possible. Check if your insurer gives any grace period for renewal if the policy break is only for a few days.
"If the policy break is longer, the insurer may insist on re-inspection of the vehicle to ensure there were no fresh damages during the policy break period. Some insurers have the provision of self-inspection where you can complete the re-inspection on your own by clicking pictures of the vehicle or sending a video recording. In other instances, the insurer may send a surveyor to your place to check the condition of the vehicle," Jha told CNBC-TV18.com.
"If the break in your policy is less than 90 days, the insurer may allow you to restore your no claim bonus. If you miss renewing your policy, make sure you do so before 90 days of the policy expiry date to protect your NCB. NCB discount is given by the insurer if you did not make any claim during the policy period and can help in reducing your overall premium outgo," he said
"Further, keep all the documents like driving licence (DL), registration certificate (RC), expired policy document, Pollution Under Control certificate (PUC), etc handy to submit the same to the insurer when renewing your policy," Jha added.
Most insurance companies send out regular reminders to the customers 1-2 months before the policy expires. However, it is best to keep risks at bay and renew your policy on time.
