Renewing your car insurance policy is essential to remain financially secure against unforeseen events like accidents or theft. With the convenience of online car insurance renewal, the process has become faster and more accessible. However, many car owners overlook critical factors during renewal, leading to unnecessary costs or inadequate coverage. This blog highlights key considerations for a smooth and informed car insurance renewal experience.
Why Timely Renewal is Essential?
Driving without a valid car insurance policy is illegal and exposes you to significant financial risks. Under the Motor Vehicles Act 2019, driving without insurance attracts penalties of up to INR 2,000 for the first offence and INR 4,000 for subsequent offences, along with possible imprisonment of up to 3 months. However, suspension of the driving license is not explicitly stated as a penalty for this violation. Beyond legal issues, an expired policy leaves you unprotected against damages to your vehicle or third-party liabilities, creating potential out-of-pocket expenses.
The Ideal Time to Renew
Renewing your car insurance within the last 45 days of its validity is advisable to avoid lapses. This window gives you ample time to review your current policy, compare alternatives, and make any adjustments based on your current needs. If you miss the renewal deadline, insurers typically offer a grace period of 15 to 30 days. The 90-day period generally applies to retaining the No Claim Bonus (NCB), not the grace period itself. Keep in mind that renewing during the grace period may attract additional charges.
Key Factors to Consider Before Renewal
Renewing your car insurance is a vital step in ensuring uninterrupted financial protection and compliance with legal requirements. To make the most of your renewal, it’s essential to evaluate various aspects of your policy to secure comprehensive coverage that suits your current needs.
1. Review Your Current Policy
When opting for online car insurance renewal, renewing the same policy without reviewing the details is tempting. However, your coverage needs may have changed over time.
What to Do:
● Check the existing policy’s coverage, including third-party liability and comprehensive benefits.
● Assess whether the add-ons you previously selected are still relevant to your current situation. For instance, a Passenger Cover may not be necessary if you travel alone.
2. Insured Declared Value (IDV)
The IDV represents the maximum amount your insurer will pay if your car is stolen or totalled. A lower IDV reduces your premium but may leave you underinsured, while a higher IDV increases the premium unnecessarily.
What to Do:
● Use a car insurance calculator to Understand that IDV is calculated based on standard depreciation rates set by the Insurance Regulatory and Development Authority of India (IRDAI). Policyholders can only select from a range of values within the insurer's preset guidelines.
3. No Claim Bonus (NCB)
The NCB is a discount offered for every claim-free policy period, potentially reducing your premium by up to 50%. Many policyholders forget to apply this during renewal.
What to Do:
● Confirm that your NCB has been transferred or applied correctly. Keep in mind that the maximum NCB discount of 50% is typically applicable after five consecutive claim-free years. NCB cannot be transferred during mid-policy renewals or grace periods.
4. Compare Policies Online
Sticking with your current insurer without exploring alternatives may result in missed opportunities for better coverage or lower premiums.
What to Do:
● Compare different online car insurance renewal options from various insurers. Look for discounts, better add-on covers, and customer service reviews.
5. Add-On Covers
Add-ons such as zero depreciation, engine protection, and roadside assistance offered by insurers can significantly enhance your car insurance policy by providing additional financial security.
What to Do:
● Evaluate the relevance of each add-on based on your current needs and driving habits.
● Remove add-ons that no longer align with your requirements to avoid unnecessary costs.
● Remember that certain add-ons, such as zero depreciation, are typically available only for vehicles up to 5-7 years old.
6. Update Personal Information
Outdated personal details, such as an old address or phone number, can lead to complications during claim settlements.
What to Do:
● Ensure your details are updated during the renewal process.
Benefits of Renewing Car Insurance Online
Renewing car insurance online offers several advantages, including:
● Convenience: The process can be completed in a few clicks without physical paperwork or visits.
● Cost Savings: Online platforms often provide exclusive online savings.
● Transparency: You can compare policies, add-ons, and premiums before deciding.
● Quick Assistance: Insurers like Bajaj Allianz General Insurance Company provide 24x7 call assistance and instant updates via SMS, ensuring seamless claim support.
Tips to Save Money on Your Renewal
Saving money on your car insurance renewal doesn’t have to mean compromising on coverage. By being proactive and making informed decisions, you can reduce costs while maintaining comprehensive protection.
1. Choose Higher Deductibles: Opting for a higher voluntary deductible can lower your premium. It will also increase your out-of-pocket expenses during claims.
2. Install Anti-Theft Devices: Many insurers offer discounts for cars equipped with certified anti-theft systems.
3. Leverage NCBx: Maximise your NCB to reduce premium costs.
4. Opt for Online Policies: Direct-to-customer digital insurers often offer better rates.
Common Mistakes to Avoid
● Ignoring Policy Details: Renewing without reviewing coverage may result in paying for unnecessary features.
● Forgetting Add-On Relevance: Continuing with irrelevant add-ons increases your premium without added value.
● Delaying Renewal: Missing deadlines could lead to policy lapse, legal issues, and higher costs.
● Overlooking Discounts: Many miss out on offers that could reduce renewal costs.
Final Thoughts
Renewing your car insurance policy is a critical step in ensuring financial protection and legal compliance. By choosing online car insurance renewal, you not only simplify the process but also unlock opportunities to customise your coverage to fit your needs.
Take the time to review your existing policy, compare options, and make necessary adjustments to maximise benefits and minimise costs. A little attention to detail can go a long way in ensuring peace of mind and hassle-free driving.
*Standard T&C Apply
Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.
Claims are subject to terms and conditions set forth under the motor insurance policy.
