Why Is It Essential to Renew Car Insurance?

CIOReviewIndia Team | Friday, 14 August 2020, 14:04 IST

Why Is It Essential to Renew Car Insurance?

According to the traffic laws in India, all car owners must hold an insurance policy. Under the Act of 1988, the owners should have third-party limited liability car insurance compulsorily. For protecting your vehicle as well as third-party assets and individuals, a comprehensive plan is the best guide. For doing away with damages and injuries always, you must renew the policy from time to time.

Car insurance renewal is essential, and the following reasons explain why -

  • Legal liabilities get secured

    As mentioned earlier, a four-wheeler policy is compulsory, and so is a third-party liability. Holding a valid car insurance policy offers you legal coverage when you are in a stressful situation like accidents which leads to injuries or death of a third-party. If you do not have a policy at such times, your legal troubles could increase. You could get charged a penalty or sentenced to jail, or both.

  • Offers financial coverage

    Apart from legalities, your financial woes increase significantly if you do not do car policy renewal. Insurers are not obliged to provide you coverage for a single day after the policy lapses. In such scenarios, you need to bear the costs associated with your and third-party person treatment and hospitalisation. You may need to pay the repair damage for yours as well as third-party vehicle owing to the accident. So, non-renewal impacts your savings severely.

  • Coverage against natural and human made calamities

    Car insurance policy renewal is essential if you want to protect your vehicle from natural calamities such as floods, earthquakes, tsunamis, cyclones, storms, tornadoes, etc. which could potentially destroy the asset. Furthermore, there is coverage against humanmade disasters as well like theft, riots, strike, terrorism, and so forth. However, these are possible only under comprehensive plans.

  • No Claim Bonus

    The moment you renew the four-wheeler insurance online without raising any claim during the period, you become eligible for No-Claim Bonus. It is a discount you receive on the premiums which get availed during the policy renewal. The discount starts with a minimum of 10 per cent and goes up to five years, i.e. 50 per cent.

  • Add-ons

    There is a possibility that you might not be too happy with the existing coverages and need more. During the renewal, you can opt for riders for enhancing the policy coverages. Based on the insurer you select, you can access various add-ons like zero-cover depreciation, engine cover, accessories cover, and so forth.

Why Is It Essential to Renew Car Insurance?

Steps to do renewal

The best part is, nowadays, you can do online car insurance renewal. The process is simple and hassle-free, and you can do so with a few clicks. Following are the steps -

  • Visit the insurer portal.
  • Enter your name, contact number, and vehicle number along with the insurance policy number, among other things. The details pop up in the system
  • Modify the existing car insurance as needed. Change the policy type, the IDV of your vehicle, and add/remove the add-ons as required.
  • Once modified, you get redirected to another page where you can review the policy, check the NCB, and the new premium amount.
  • Pay the premiums online and receive your policy through e-mail correspondence.

Read Also - Benefits of Buying Long-term Car Insurance