Car insurance: the dangers of driving a car with an expired policy

If you are the owner of a vehicle, it is compulsory to have liability insurance in accordance with the Motor Vehicle Act. Driving an uninsured vehicle will result in a 2,000` fine for the first offense or up to three months imprisonment. The amount of the fine doubles for each subsequent offence. In addition to this legal aspect, many other factors make it essential to insure your vehicle.

In the event of an accident, the insurer will not settle any claim in the event of forfeiture of the contract either for own damage or for prejudice to a third party, where the liability may be unlimited. It will not pay any personal accident coverage for hospital bills. Vehicle damage due to natural disasters such as a storm or earthquake will also not be covered. Even the transfer of the car registration or the termination of the mortgage of the registration certificate after the closing of the car loan cannot be carried out in the event of an expiry of a car insurance policy.

Renew an expired policy
It is crucial to renew your car insurance policy before the expiry date. Do not neglect the renewal reminders sent by the insurance companies a month in advance by SMS or email. Renew the policy online via net banking or debit/credit card or by depositing a check at the insurer’s branch.

Ideally, those who bought their vehicle after 2018 should opt for a long-term policy (three years for cars and five years for two-wheelers) which will save them from having to renew it every year. Also opt for a global policy with a supplement to reduce the financial burden in the event of an accident.

Car inspection
If your car insurance has expired, it will take longer to renew the policy because the insurance company will carry out an inspection of the car. This process may take time and you will have to pay the inspection fee. Keep all documents ready for inspection, including past claims, if any. In the event of minor damage/dents, the insurer will reduce the declared value after the inspection and set the premium accordingly. The vehicle appraisal certificate is not valid for more than 24 hours, so be sure to submit all documents on time.

Rakesh Goyal, Director of Probus Insurance, says: “Renewing your car policy on time helps you avoid the hassle of paying higher premiums that would otherwise be charged when your policy expires.

Loss of unclaimed bonus
A breach in the policy would mean that the insured will lose the accumulated no-claims premium (NCB) for not raising any claims during the policy year. This bonus can be used while you renew your policy on time. The PNE discount is 15 to 20% for the first claim-free year and increases to 50%.

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