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If you don’t renew your car insurance timely, it may cause you legal trouble and serious financial losses. Car insurance is usually a year’s coverage and you are not covered once it expires. Legally, you can’t drive if your vehicle is not insured. You should at least have third-party insurance in order to not attract hefty fines. Unfortunately, if you meet an accident causing injury to others, it may put you in legal trouble as well as stress. In order to cover damages to cars, one must have an active comprehensive policy.
Renewing your car insurance post expiry can be tedious and you may lose some benefits such as a No Claim Bonus. No Claim Bonus is a discount that you get if you don’t make any car insurance claim during the policy tenure. It works almost like a rewards system. You start by gaining a 20% NCB discount if you haven’t made any claims for your first policy year. Further, you keep gaining an additional 5% from your second consecutive year of making no claims. This can go about a reduction of 50% in your fifth year. NCB benefit is lost if your policy expires in more than 90 days window.
Moreover, if you don’t renew your insurance, you will also have to face the hassle of subjecting your vehicle to an inspection and verification. This inspection is done to document any pre-existing damages to the car.
Lastly, it goes without saying that if you fail to renew your policy and your vehicle faces any damage during this period it will not be covered by the insurance company. For instance, if there is any damage because of natural calamities or your car gets stolen, you can't rely on the insurance company.
07 May, 2021