If you’ve purchased a vehicle insurance, renewing it on time becomes equally important. You need to renew your motor insurance policy every year, as it is an annual contract, unless you opt for a long term policy. If you forget to renew it, then your policy will be invalid, and you will have to buy a fresh new policy from an insurance company who will cover your vehicle again.

There might be instances when you must have genuinely forgotten to renew your motor insurance premium. However, it is observed that many vehicle owners do not renew their motor insurance policy on purpose, even though it is a mandatory requirement. People do this to save themselves from paying the premium. But, they are not only losing the accumulated benefits but also exposing themselves to financial liability in terms of vehicle repair.

No matter what the reasons are, if you miss out on renewing your vehicle’s motor policy even by one day, your policy will lapse. You would then have to reinstate the policy by following the procedure, which is applicable when you purchase a new car insurance policy.

The process won’t be complicated if you are applying for a third-party motor insurance cover. The insurance company might offer the policy even after a break-in. Note that any claim on the vehicle during the period when the car was not insured, won’t be covered by the insurer. On the other hand, if you’ve opted for a comprehensive policy which is more preferred, you will have to go through a longer process.

If you wish to renew your lapsed comprehensive motor insurance policy, you will need to fill up a new proposal that is filled to insure a new vehicle. The insurance company will also inspect your vehicle. This inspection is usually done to check if there are any pre-existing damages to your car. If yes, the insurance company won’t cover it in the future, even if they agree to provide insurance for your vehicle. Also, remember that higher premium might be charged for a car whose policy has lapsed. Or, there are high chances of your insurance proposal to get rejected.

If your policy lapses, you will also lose the accumulated benefits termed as NCB (No Claim Bonus) during insurance renewal. It is basically the concession you get every year when you don’t make a single claim on policy. Also, you do not get the benefit of transferring NCB to the new vehicle if you were planning to purchase one. The premium will be even more for a new and higher-end vehicle, than an old one. If you lose on NCB benefits, you can lose the opportunity of paying a lower premium on your new car.

Now that you are aware of the many losses as well as complications you might have to face in you go to renew a lapsed motor insurance policy, it becomes even more important to renew on time. Technology has made things more accessible than ever. Now, the insurance companies notify you regarding car insurance renewal online via emails or SMS alerts. If you renew online, you can also get a digitally signed policy immediately.