Two-wheeler insurance is compulsory in our country. One must pay regular premiums to keep the insurance policy active. Failure to pay on time to renew a policy will lead to policy lapse. When an insurance policy expires, the policyholder will lose the benefits of the policy and cannot raise a claim. Insurance companies have introduced a “grace period” to give policyholders a chance to make the payment and reinstate the cover. Read further to understand this in detail.
What Happens When One Does Not Renew Two-Wheeler Insurance
● As citizens of this country, it is important to adhere to the law of the land. As per the Motor Vehicle’s Act, 1988 it is mandatory for all those who own vehicles to own at least third-party insurance. If caught not owning valid two-wheeler insurance, one can be fined heavily.
● No Claim Bonus (NCB) is a discount provided to policyholders who do not raise a claim during the policy tenure at the time of policy renewal. One can accumulate this benefit and avail up to 50% discount on the next premium.
● Insurance protects the policyholder and keeps them secure financially. When one allows their policy to lapse, they are not eligible to make claims, and this will require them to pay from their pocket.
What is a Grace Period?
A grace period is a certain amount of time after the premium is due in which the policyholder can make the premium payment to prevent the policy from lapsing. The number of days in the grace period varies depending on the insurer and the type of policy. The grace period can be between 24 hours to 30 days and the amount of time granted in the grace period is mentioned in the policy contract. It is important for policyholders to check the number of days and make the payment before the policy lapses.
Ways to Avoid Policy Lapse
● Though insurance companies offer a grace period, it is best if one does not rely on such extensions and ensure to renew the policy on time. New age insurance companies keep in touch with policyholders on their registered mobile numbers. One can renew their policy on time by keeping track of the reminders.
● Buying long-term bike insurance with coverage of up to 3 years – 5 years is a smart way to avoid policy lapses. One will not have to bother about renewing the policy annually
● Earlier, insurance renewal was tedious, and one would have to visit the insurance company branch, or sit with the agent for paperwork. The process and wait could go on for long hours. These days one can easily renew their bike insurance from the comfort of their home, through the official website of their insurance company.
It is important for one to keep a tab of when the policy is lapsing and set a reminder to renew the policy at least a week or two before the policy expires. These days insurance companies send reminders through emails or texts when it is time to renew the policy. Remember that it is mandatory for all vehicle owners to own two-wheeler insurance to keep themselves financially and legally secure. To know more about two-wheeler insurance and its features, click here!