What Happens If Your Car Insurance Policy Lapses?

An insurance policy provides financial protection against damage to your car. When an insurance policy is active, and a mishap occurs, it reduces your financial outflow since the insurance company pays for a major portion of the repair costs. But what will you do if your insurance policy lapses?

An insurance policy lapse means you have missed your premium payment, and your car is no longer protected against damage or loss. It is similar to forgetting to recharge your mobile's prepaid plan — your calling and data services are disconnected until you recharge.

What happens when your car insurance policy lapses?

• Out-of-pocket pay: If you have not paid the premium and get into an accident, you will be responsible for bearing all the repair costs.
• Legal trouble: Driving your car without third-party liability insurance is illegal across India. Doing so entails fines, and repeated offences can lead to imprisonment.
• Expensive renewal: The increasing period after the policy lapse often results in higher premium costs for the new policy. Your insurance provider may re-inspect your car before the car insurance is re-issued. You can use your grace period and pay the premium as soon as possible to avoid the higher costs.
• Loss of benefits: If your policy lapses, you will likely lose the benefits accrued, such as the no-claim bonus.
• Suspension of vehicle registration: If your policy lapses and you continue to drive your car, your car registration may also be suspended.

How to avoid policy lapse?

You can set payment reminders or opt for the automatic debit feature to avoid a lapse. If you still miss a payment, please contact your insurer immediately. You will need to undergo a vehicle inspection with your insurer renew your policy.

What to do if your policy has lapsed?

1. Avoid driving your car. Driving a vehicle with an expired policy can cause you trouble.
2. Call Royal Sundaram’s customer care / visit our website for getting your insurance renewed. Select the plan of your choice and proceed to checkout.
3. The insurance provider may schedule an inspection according to their policy. Keep the car papers handy for the inspection visit.
4. Once the inspection is done and payment is processed, your new policy will be activated.

Remember, don't let your policy lapse. Check out Royal Sundaram's Car Insurance plans and drive worry-free.