Grace Period in Car Insurance & Its Importance
Car insurance is legally mandatory in India, which is why renewing your policyRead more
What is Grace Period in Car Insurance?
Grace period in car insurance is a specific period of time that is provided by the car insurance company for you to renew your policy after it has expired.
The grace period plays an important role in protecting your No Claim Bonus (NCB). NCB is the discount you accumulate for every consecutive claim-free year. If you renew your car insurance policy within the grace period, you can retain your NCB discount, despite the break in policy. However, if you fail to renew even within this period, the policy is considered lapsed, and you even lose your NCB benefits.
Even though insurers offer you some extra time to renew car insurance policy, it is important to keep your car insurance active at all times because unforeseen situations like cyclones, riots, theft, etc., can occur at any time. It helps you stay financially protected at all times, as any damage to your vehicle is not covered during the grace period.
What is the Duration Of the Grace Period in Car Insurance?
Grace period in a car insurance policy is usually 15-30 days. It depends on the terms and conditions of the policy of your insurance company. You can also renew your policy after the grace period, but this may increase your premium, and you will lose your NCB in car insurance as well. Apart from that, insurers also conduct a mandatory inspection before issuing your new policy, which causes unnecessary delays and inspection charges.
Why is Grace Period in Car Insurance Important?
Here are some of the reasons why grace period in car insurance is important:
- Prevents Policy Termination: The grace period gives you additional time to renew your policy after expiry, so it does not lapse instantly.
- NCB Stays Intact: Renewing within the grace period ensures your accumulated NCB remains valid and you get the renewal discount.
- Smooth and Fast Renewal: Renewing within the grace period helps to avoid hassles and ensures faster renewals.
What Happens During the Grace Period?
While your policy is in grace period, you must remember the following things:
- The insurance company will not be liable to provide any cover or accept any claim if you do not renew your policy on time.
- It is mandatory to keep your active car insurance policy with you while driving, so not renewing the policy can put you in legal trouble as well.
- If the insurance policy expires then the insurance company will again send an inspector to renew the policy.
- You will be liable to pay for the third-party liability and own-damages out of pocket if you do not renew the policy on time.
Steps to Take in the Car Insurance Grace Period
If your policy has entered the grace period, you must renew it instantly using the steps given below:
- Visit the official website of Policybazaar Insurance Brokers Pvt. Ltd.
- Select car insurance
- Type in your vehicle number and click on 'view prices'
- Fill in your name and mobile number and submit the form
- All the available plans will be displayed on the screen
- Check all the details, select your NCB and IDV, choose the required add-ons, and finalise the insurer
- Pay the premium and your car insurance will be renewed
What To Do If The Insurance Expires
There are certain things that you will have to keep in mind in case your insurance policy expires.
- Contact your insurer and tell them about the expiration of your policy. You can contact them through the website, call, or email.
- Do not drive your car until your car insurance is renewed otherwise you might attract legal actions against you.
- You can review your insurance plan and check if you want to change your plan or add on some riders.
Conclusion
It is important that you renew your policy on time for continuous coverage and hassle-free services. Not renewing the policy on time causes a lot of difficulties. The grace period gives you a chance to keep your benefits intact and gives you a fair chance to renew your policy.
