Car insurance policies are applicable only for a limited period. You have to renew them from time to time to continue enjoying the benefits. But if you forget to renew your car insurance before the expiry date, the break-in period sets in.
What is the Break-in Period in Car Insurance?
A break-in period in car insurance is the period between the expiry date of your insurance policy and the date you renew the insurance. Suppose the insurance policy expired on 13th October, and you renewed it on 2nd November. The period of 20 days between the expiry and renewal dates is the break-in period in car insurance.
Break-in Period Should Be Limited
Just because you are allowed a break-in period in car insurance does not mean you should stretch it as long as you can. All insurance companies have a set car insurance expired grace period. You will lose all the benefits accumulated from your previous policy if you do not renew your insurance within this grace period.
Most insurance policies offer a car insurance renewal grace period of 90 days (approximately 3 months). You must renew the car insurance within 90 days to keep the benefits from the previous policy. So, your break-in period should not exceed 90 days.
Essential Facts About Break-in Period
Many insurance policyholders have a lot of misconceptions about the break-in period. Some believe you can request a claim in this period, while others think you can renew it whenever you feel like it. Well, that's not true at all. So, here are the essential facts you should know about renewing car insurance and the break-in period.
- You cannot submit a claim request during the break-in period.
- The maximum allowed break-in period is 90 days for most insurance companies. This is known as the car insurance renewal grace period.
- The benefits from your previous policy, such as the No Claim Bonus (NCB) discount, are applicable only if you renew the policy within the grace period.
- Your car is not insured during the break-in period. So, any damages during this period must be paid out of your pocket.
- If caught by the traffic police, you will have to pay a car insurance expired fine.
Benefits of Renewing Car Insurance Within Grace Period
If continued protection for your car and third-party car insurance are not reasons enough to renew your car insurance within the grace period, then here are some benefits that will compel you to renew your car insurance in the break-in period.
- You Are Safe from the Law
According to the Motor Vehicles Act 1988, driving a car in India without valid car insurance is a punishable offence. If the traffic police stop you for some reason and they find you don't have a valid insurance policy, you will have to pay a car insurance expired fine. For first-time offenders, the fine is INR 2,000; for repeat offenders, it could go up to INR 4,000. Or if you are in an accident and damage a third-party vehicle or your own, you will be held accountable due to lack of insurance policy.
- Continuation of No Claim Bonus
Almost all car insurance policies have a No Claim Bonus discount. If you do not file a single claim during your policy, you can get up to a 10% discount on your renewal. Some policies even let you add this discount in the subsequent renewal.
For example, you had car insurance for 1 year in 2023. You didn't file a single claim in 2023. When you renew your policy in 2024, you might get up to a 10% discount. Then again, if you didn't file any claims in 2024, you might get a 10% additional discount on top of the original discount.
This means that, in 2025, you might get a 20% discount on your car insurance renewal. You can get up to 50% discount in the coming years. However, you will not receive this benefit if you do not renew the policy within the car insurance renewal grace period.
If you want to keep enjoying benefits such as NCB and avoid car insurance expired fine, you must renew your insurance policy within the stipulated time. We at Future Generali send you reminder emails or SMS to ensure you know your car insurance is about to expire. This way, you can keep track of your policy and renew it before the maximum acceptable break-in period.
FAQs
What happens if I do not renew my car insurance within the grace period for renewal of car insurance?
If you do not renew your car insurance policy within the grace period for renewal of car insurance, then you lose the right to benefits from the previous policy. The policy you buy after this grace period will be considered an entirely new policy.
Will I be fined for car insurance in the break-in period of 90 days?
Yes, you will be fined in the break-in period of 90 days if you don't have a renewed insurance policy.
Can I do a car insurance renewal online?
Yes, you can do car insurance renewal online by visiting the website of your insurance company. If you do not know the renewal process, contact an agent for help.
