Home Featured 4 Things You Should know About A Lapsed Car Insurance Policy

4 Things You Should know About A Lapsed Car Insurance Policy

things you should if your insurance lapse

Owning a car is no less than a necessity in life these days. It also checks off the shared dream of many Indians to travel whenever and wherever they want. The unit sales stats of some of India’s best-selling cars in FY2019 confirm that too. But even the most experienced car drivers meet with an accident sometimes because of other’s mistakes. Similarly, they often commit driving mistakes and end up entangling themselves in a road accident. A comprehensive car insurance policy helps a lot in dealing with all such situations.

A car insurance policy covers the potential losses that you might have to incur due to mishaps involving your vehicle. Since the plan comes with limited validity, you need to renew timely to continue getting the insurance benefits. Failing to renew the policy will make it lapse, resulting in the loss of all the benefits you get with it. Also, you might not know what can happen if you do not renew your lapsed car insurance policy.

Loss of Third-Party Coverage

third party insurance coverage

In the event of a road accident, an active car insurance policy can save the day. It will cover third-party vehicle damage repair expenses and medical care costs that may arise out of an accident. Alongside, you can ask for legal coverage from the insurance company as covered under the terms of your car insurance policy.

However, an expired car insurance policy can’t help at all in dealing with such situations. It is why timely renewal is crucial to avoid bearing the expenses related to an accident out from your pocket.


No Comprehensive Coverage

The damages resulting from a road accident are mostly two-sided – towards the victim as well as the offender. A comprehensive car insurance policy provides both third-party as well as own damage cover.

However, having an expired vehicle insurance policy means you will lose both these insurance covers. In other words, not renewing your policy on time means you will also have to pay for the repair work your car needs after the accident. This financial loss will vary depending on the severity of the accident.


Penalties for Not Having a Valid Policy

Penalties for Not Having a Valid Policy

You might have heard of situations in which many car owners change the route to avoid being caught by the traffic police. It is because driving a car with an expired insurance policy is an illegal offence in India.

If you get caught during random checks at the roadside or traffic lights, you will be fined or jailed for not carrying a renewed car insurance policy. As per the recent changes in the traffic laws, you will have to pay a fine of Rs. 2,000 and/or imprisonment up to 3 months.


Loss of No Claim Bonus (NCB)

Loss of No Claim Bonus (NCB)

Your insurance company rewards you with an NCB for not filing a claim during the car insurance policy tenure. It comes in the form of a discount on the policy renewal premium at the end of its tenure.

Also, it varies from one insurer to the other and gets added up for consecutive claim-free years to offer you a significant benefit. Another loss of having a lapsed car insurance policy is that you won’t get the NCB accumulated over the years for not filing any car insurance claim.


Your car insurance policy is only beneficial for you as long as it is active. It makes car insurance renewal as crucial as buying it. You should also know that you can switch to another insurer before renewing the policy.

Make sure you select a reputable car insurance company like Tata AIG while doing so. There are many reasons why people share positive Tata AIG car insurance reviews. Be safe and drive comfortably when you have the best car insurance that fulfils your needs.

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