Motor insurance policy lapsed? Know your options of reviving a lapsed policy

By: |
February 25, 2020 4:35 PM

Renewing a lapsed insurance policy is tougher than renewing an active insurance policy, because, as the number of days the renewal has been delayed increases, the options of reviving the policy start getting limited.

Motor insurance, how to revive lapsed policy, lapsed motor policy, Motor insurance in 2020, Motor insurance premium, Motor insurance penalty, Motor Third Party, IrdaiBoth web aggregators and online insurers, generally approve for the cover without an inspection if the request is made within 90 days.

There can be many reasons why one might miss the renewal date of one’s motor insurance policy, and drive around with a lapsed insurance policy. Driving around with a lapsed policy might not have mattered so much in the past, as the driver could get away just by paying a fine of Rs 1,000. However, with the new Motor Vehicle Act 2019, car owners now have to shell out Rs 2,000 for the first-time offence, while for repeating that offence the fine doubles.

Since the new motor insurance rules, experts say car insurance sales have increased by around 3-4 times and around 6-7 times for two-wheeler. The high penalty has made many vehicle owners opt for insurance hastily.

Having said that, renewing a lapsed insurance policy is tougher than renewing an active insurance policy, or buying an insurance policy online. It is so because, as the number of days the renewal has been delayed increases, the options of reviving the policy start getting limited. Nevertheless, there are certain ways to revive a lapsed policy.

What are your renewal options?

You have several options, from approaching an intermediary or an agent, insuring online, or simply walking into the office of any insurance company offering motor insurance, to revive your lapsed cover.

If you go to renew your cover within 90 days of expiry, your previous No Claim Bonus (NCB) will be carried forward. If you delay and go beyond 90 days, that will not only result in the loss of NCB but could also be asked to pay higher premiums.

For renewing your policy online, keep the required documents ready, and log on to the insurer website, then enter your plan details and make the payment. For doing it offline, carry your policy documents to the insurer’s branch, to renew it.

Best bet between third-party and comprehensive policy

Third-party insurance alone is enough if you just want to save yourself from paying a hefty fine in case of an accident. Having third-party insurance pays for the losses and injury or damage to the third party caused by your vehicle in case of an accident. However, it does not cover anything related to your own vehicle. This is the reason the premiums for third-party insurance are quite low when compared to comprehensive motor insurance policies which also includes damage to your own vehicle.

If you opt for a comprehensive insurance cover, it is usually time-consuming as the insurance company asks details about the vehicle’s condition before approving a policy. In case of reviving a lapsed policy, this can be avoided with a comprehensive plan, if you make the request within 90 days of the lapse of the previous policy. Both web aggregators and online insurers, generally approve for the cover without an inspection if the request is made within 90 days.

If you try to revive a policy after the gap of 90 days, even though few minor damages are ignored, a vehicle with more than four minor dents or a crack in the windshield, the insurer might reject your proposal. Even though most insurers insist on a physical inspection, some insurers also have the option of a digital self-inspection system for physical verification, wherein you have to take pictures or videos of the vehicle use their mobile app.

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