It is important to keep your car insurance policy active if you wish to continue using your car. Why? Firstly, because Indian laws mandate every car owner to have an active insurance policy, and secondly because it covers you financially in the face of a mishap involving your car. An expired policy can lead to a fine or imprisonment, or both, depending on the situation. In addition, you will lose financial protection against any damage due to accidents or other reasons, and access to benefits such as cashless garage service.
Insurers send periodic reminders about renewals but there could be instances when you forget to renew the policy and it expires. Renewal of an expired policy will involve additional charges and an inspection of your car in certain cases. Now that most insurers have an online presence, you can renew your car insurance policy online. In the case of old cars also, if your insurer permits, you can avoid submission of any hard copy of documents or avoid the inspection process for your car. Inspection and approvals take time, so it will delay the renewal process.
Plus, an expired policy can land you in trouble if you get caught. If your car renewal date is due, complete the process at the earliest otherwise you may have to deal with the following:
- Cancellation of licence
In India, it is mandatory to have a third-party insurance policy for any vehicle. The policy can protect you against legal and financial liabilities in case of an accident that may lead to a third-party injury or death or damage to third party property or car. If an accident happens when you do not have insurance, then the traffic authorities have the right to suspend or cancel your driving licence.
- Suspension of vehicle registration
You may get your vehicle registration certificates suspended in case you do not have an insurance policy. In this situation, you would not be able to drive your car even in case of an emergency unless the suspension is lifted.
- Fine and imprisonment
Depending on the intensity of the situation such as an accident or collision, in the absence of insurance, you may face serious charges. There could be a hefty monetary penalty imposed on you or you may face imprisonment. In certain cases, both fines and imprisonment may be imposed. Besides, breaking the rules may go as a permanent record in your driving history.
- Financial stress
In the absence of insurance cover, if you face an accident involving a third party, you will have to bear the burden of all legal and financial issues on your own. If there is an injury to the third-party individual, damage to his property or car, then you have to pay up for any claim made. If there is an unfortunate event in which the third-party individual loses his life due to the accident, matters can turn worse. You will be drawn into a long legal battle along with payment of the entire compensation amount on your own.
- Damage to your car or yourself
It is also possible that you may get injured yourself, your car also gets damaged or in extreme situations, there is temporary or permanent disability to yourself or loss of life. So, renewal of your own damage policy and personal accident insurance is also important. All financial expenses have to be borne by you or your family and in your absence, your loved ones may have to face financial difficulties. These situations are unpredictable but practical.
- Loss of No Claims Bonus
In the absence of an insurance policy or expired policy, your No Claims Bonus or NCB that you may have accumulated by not making any claims during the entire period would get cancelled. So, the advantage of a discount on the renewal premium that you had received would be lost.
For most car owners, remembering the annual renewal date could be a challenge. Missing it can lead to trouble such as fine, late charges, loss of NCBs etc. The good news is that now the compulsory third-party liability policy would be valid for three years, as per the new rule for car insurance in India. By getting a long term car insurance policy, enjoy the benefits of coverage for several years without the risk of default. However, for a comprehensive insurance cover, you have to renew the OD (own damage) component every year. The benefit of multi-year car insurance is that you can avoid annual renewals. You do not have to renew the policy every year, so there would be no hassle of remembering the dates for renewal, paying fines in case of missed renewals etc. Also, the system of online purchase and renewals of long-term policies is an added advantage.
Remember to carry your insurance document with you while driving your car and get your car insurance renewed on time. Since an insurance cover can save you from several difficult situations, you should renew car insurance on time to continue with the benefits. Go for an offline or online car insurance renewal as per your convenience but do not delay the process.
