What Happens If You Fail to Renew Your Car Insurance Policy?
Car insurance offers financial protection in the event of accidents or damages. However, in order to get that financial coverage, your policy needs to be active and that requires timely renewals.
For example, a Tata AIG car insurance claim would only be admissible if your policy was active and in effect during the time of the accident. If the policy was lapsed/inactive at the time of the accident, the insurer would reject your claims application.
In this article, you will get to know what to do if you fail to renew your car insurance policy, either willingly or inadvertently, and the implications of this decision.
Why is Car Insurance Necessary?
Car insurance financially secures the vehicle owner and third party during an accident. The compensation given is customarily used for medical expenses (if the policyholder gets injured), vehicle repairs and paying the other party for damage caused to their vehicle.
Moreover, renewing your four-wheeler insurance on time not only protects you from financial risk in the event of accidents but it can also help you maintain a positive insurance history. Insurers often view drivers with uninterrupted renewal as low-risk, which can help with securing low premium rates.
How Long Can You Go Without Insurance After its Expiry?
It is not permissible to drive your car after policy expiry. However, some insurance companies offer the facility of a break-in period. The duration of this facility depends on your insurer but it usually ranges from 30-90 days.
What Will Happen If You Forget About Your Car Insurance Policy Renewal?
Normally, car policy renewals online or offline come with a grace period (30 – 60 days) after the due date. It’s important to renew your policy within this time frame to avoid a policy lapse. A detailed explanation of what to do in such situations is given below:
Renewing Your Insurance After its Expiry:
The day after a car insurance policy’s expiry date marks the beginning of the grace/break-in period. During this period, the policyholder can renew without any issue as the insurance remains active.
You can wait to renew your policy until the last date of your grace period, but this is not advisable. In fact, you should renew your insurance as soon as possible so that you can receive compensation if an accident happens.
Important Note:
- If you haven’t renewed your policy and are currently going through the break-in period, you should know that you cannot raise a claim in this situation.
- A grace period starts when your insurance policy expires, which means that you will not be getting compensation for an accident and your claim will get rejected.
Renewing Your Policy Post Break-In Period
There is no such type of renewal service available to the policyholder as after your break-in period, your insurance lapses/becomes void and the contract gets terminated. After that, you will have to buy a new offline or online car insurance policy.
Which Documents Are Needed for Online Car Insurance Policy Renewal?
- The Registration Certificate (RC) of your car.
- Previous Car Insurance Policy.
- PUC Certificate
- Driving Licence
- ID and Address Proof
The Risks of Driving Without Car Insurance
Not performing your car insurance renewal online on time can have serious consequences. In the event of an accident, you may be held responsible for all the damage expenses, including property and personal injury.
You can also face legal fines and penalties.
Driving without car insurance is an offence for which a fine of ₹2000 – ₹4,000 is levied. In more severe cases, the driver can also be imprisoned for up to 3 months, have their licence suspended and their car seized. It is, therefore, imperative to renew your car insurance on time.
Lastly, any accumulated discounts or benefits under your policy, like an NCB discount, would be void if you let your policy lapse and do not renew on time. This means you will have to buy a new policy, risk higher premium rates and start all over again.
Conclusion
In conclusion, it is highly recommended that you perform your car policy renewal online or offline on time – on the due date or within the grace period. The financial, legal, and personal risks of driving without insurance are too great to ignore. Even if you are looking to save money, there are safer ways to do so without compromising your protection on the road.
Many online insurers like Tata AIG send reminders via email to ensure that you do not forget to renew your policy and offer instant policy renewals on their website for more convenience.