Motor Insurance Policy: What Happens When You Have a Lapsed Motor Insurance Policy?

Motor insurance is of utmost importance for every vehicle owner, and it should never be allowed to get lapsed in the first place. It is crucial to keep it active by renewing it times before it expires. 

Once your motor insurance gets lapsed, and if you are still running your vehicle, then you run a lot of risk of damage costs and legal hassles. Once your motor insurance policy lapses, it also means going through the inspection process again for the policy renewal. Let’s look into the issues you may face if you don’t have an active motor insurance policy and how to get it back in place. 

Why Do You Need an Active Motor Insurance Policy?

If you have a vehicle and wish to get reimbursed for any damages that may happen to your vehicle, then you need motor insurance, or you have to bear the costs yourself.

Even if you don’t worry about damages and repair costs of your own vehicle and hence, don’t wish to renew your motor insurance, you are required to have third-party car insurance. Third-party motor insurance is mandatory under the Motor Vehicles Act, as this ensures that you can pay the damage costs in case you cause an accident and cause damages to another person or others’ property.

Driving an uninsured vehicle entails a penalty of 2,000 for the first offence and/or imprisonment of up to three months. The penalty amount and risk of imprisonment increase considerably consequently. Several other factors make it absolutely crucial and unavoidable for you to own active motor insurance.

Therefore, in order to save yourself from financial and legal troubles, it is important not to let your motor insurance policy expire. Here’s what to do in case your motor insurance policy has lapsed. *

Dos and Don’ts In Case of a Lapsed Policy

Ideally, do not let your insurance policy lapse and renew at least within the grace period to avoid all hassles. Renewal reminders from the insurance company should help you to renew your policy on time. Renewing the policy online saves the insurer time and effort. But in case of policy lapse, follow the points below: 

Contact your Insurance Agent

If your policy has lapsed, contact your insurance agent at the earliest and discuss the earliest possible way to renew it. The insurance agent’s assistance will save you further hassles, and you should be able to renew the policy without much financial loss, but you would probably lose the ‘no claim bonus’ you might have accumulated in your previous policy. *

Avoid Driving Your Vehicle

Without active insurance, driving your vehicle will only mean inviting trouble. Hence, avoid driving your vehicle until you have an insurance policy. Whether minor damage to your vehicle or severe damage to a third party or property, it can mean you bear all financial losses and legal troubles. Hence, it would be most advisable to avoid using your vehicle till you renew your policy or buy a new one. *

Purchase A New Insurance Policy

If you are unhappy with your current insurance company or are having trouble renewing the lapsed policy because the insurance company is not providing help to do so, or whatsoever may be the reason. There are many other insurance companies to choose from and buy a new policy that matches your preferences and budget. You can compare the policies and insurance premiums online and even look into the customer reviews of the companies before choosing a suitable new motor insurance policy. *

Conclusion

In a nutshell, the minimum motor insurance is mandatory for all vehicle owners, and hence, this insurance policy should not lapse or expire. If it does lapse, it is crucial to renew the policy as soon as possible or buy a new one. 

* Standard T&C Apply

Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms and conditions, please read sales brochure/policy wording carefully before concluding a sale.