What Happens if Car Insurance Expires - An Overview
When you buy a new car insurance policy, it comes with an expiration date. The policy expiration could be one year from the date of activation of the policy, or 3 years from activation or even more, depending on the policy time period as chosen by you (the policyholder). As per the New Motor Vehicles Act, 2019, all vehicle owners are required to have at least third-party insurance if they wish to drive their cars legally on the Indian roads. If you are caught driving your car without valid insurance, you may be fined up to ₹2,000 to ₹4,000 or may even be imprisoned. Further, if you are involved in an accident and do not have insurance, you will be personally liable to pay for damages caused to the third party. So it’s vital that you renew expired car insurance before expiry.
Reasons to Renew Expired Car Insurance
Here are some of the most important reasons why you should renew expired car insurance when it nears expiry:
To keep your car financially protected against accidental damages and other types of damages, theft, calamities, etc.
In order to stay with the traffic laws as laid out in the New Motor Vehicles Act, 2019.
To keep yourself protected against any third-party liabilities in case of an accident.
You may be fined a hefty amount if you are caught driving without valid car insurance.
How to Renew Expired Car Insurance
If your car insurance policy has reached its end date without being renewed, then you must lose no time to renew expired car insurance. Not only is driving your car without an active car insurance policy a contravention of the laws of the country, but it can also prove to be extremely costly if you get involved in a car accident or your car gets stolen or damaged beyond repair.
If you are wondering how to renew expired car insurance, here are the simple steps that you are required to follow.
Step 1: Assess and compare various car insurance plans.
Step 2: Select the car insurance policy that is in line with your car insurance requirements as well as your budget.
Step 3: After finalizing a car insurance policy, schedule a Car Insurance Survey with the selected insurer. This step is necessary because of the break-in of your car insurance policy, that is the gap between the expiration of your previous car insurance policy and the issuance of a new one.
Step 4: Cooperate with the Car Insurance Surveyor assigned by your new car insurance provider, and allow them to inspect your car for any damages.
Step 5: Await the results of the report submitted by ten Car Insurance surveyors. Should this report be positive, your car insurance policy application shall get approved and you can successfully renew expired car insurance.
Read More: Car Insurance Renewal
Three Categories Concerning Expired Car Insurance
Renew Expired Car Insurance Immediately After Expiry
If your car insurance plan has expired, your insurer will most likely send you a notification through SMS or email informing you that your insurance has expired. If you immediately renew your insurance within a day or two after expiry, you would not have to face any negative consequences or extra fees. You will also be eligible for using your No Claim Bonus.
Renew Expired Car Insurance Within Grace Period
Generally, insurance companies offer a ‘grace period’ of 30 days. You can renew your car insurance plan within the grace period offered by your company without any negative consequences or additional fees.
Renew Expired Car Insurance After the Grace Period Has Expired
If you renew expired car insurance after the grace period has passed, it is possible that you will have to purchase a brand new car insurance plan and your insurance premiums might also go up. Moreover, any accumulated No Claim Bonus will not be available if you try to renew your car insurance after the expiry of the grace period.
Note: Do not drive your car if your car insurance has expired until you can renew it or get a new one. If you are caught by the authorities, you may face heavy fines or even imprisonment.
What Happens to the No Claim Bonus While Switching Insurers?
If you are planning to switch insurance providers when you renew expired car insurance, you should be happy to know that any No Claim Bonus that you have accumulated during your existing policy duration can be carried forward to the new insurance company. All you have to do is inform your new insurer about your NCB details, your old policy details and details of your previous/existing insurer. The NCB will automatically be transferred to your new account with the new insurance provider. However, if you switch insurance providers after 90 days or after the specified grace period has expired, your No Claim Bonus will also expire.
Car Inspection Process
If you are looking to switch insurance providers, it is highly likely that your new insurance provider will appoint a ‘Surveyor’ who will come and inspect the condition of your car, and check for any existing damage before you can renew expired car insurance. They will also take pictures of your car as proof of its current condition. Based on the evaluation from the surveyor, the insurance company will decide your insurance premium rates.
Things to Do When Car Insurance Policy Has Expired
If you have failed to renew expired car insurance, you will need to take the following steps:
Review your old car insurance plan and look into other car insurance options that you can switch to at the time of renewal. You can also consider buying add-ons.
Immediately contact your car insurance provider and inform them that you wish to renew expired car insurance policy.
Do not drive your vehicle till the time your car insurance plan is renewed.
Make sure you keep your car available for any inspection for the surveyor that the insurance company may appoint to assess your vehicle.
Can a Policy Be Renewed From a Different Insurance Provider?
Yes, you can choose to renew your car insurance policy from a different insurer at the time of renewal. Fortunately, you can also carry forward your No Claim Bonus to the new insurance provider. However, it is recommended that you buy a new insurance renewal policy before your existing plan expires, as it will avoid any legal or financial issues that may arise out of expired car insurance.
There are a myriad of risks associated with having an expired car insurance policy. These include risks of failure to comply with the motor laws of India as well as the financial and legal liabilities that may arise out of any damages to third-party property and/or injuries to a third-party person due to an accident involving your car. Above all, if you get injured in a car accident whilst your car is not insured, you cannot access the benefits of the Personal Accident Cover of the policy. You must, therefore, be mindful of the expiry date of your car insurance policy and ensure that you renew the policy on a timely basis.