Insuring two wheeler vehicle is compulsory by law in India. The Motor Vehicles Act makes it mandatory for all owners to insure their vehicle and ensure timely renewal. This applies to two wheelers as well. Noncompliance can lead to imposition of fine and enforcement of other legal provisions provided in the act by government agencies. The insurance policy should cover third party liability by default, which implies damages to third party person and property caused by the insured vehicle should be a part of basic coverage.
The policy cover is generally valid for a year from the start date. There are times when the insured policyholder is mulling over cancelling the cover during the policy period due to multiple reasons. The reason can vary from discontent with the high value of premium paid to limited terms and coverage. With increased competition in the vehicle insurance market, the customer is often lured with schemes and offers, tempting him to switch over to a different insurer.
Is the Two Wheeler Insurance Cancellable?
Yes, it is. The policy can be cancelled not only after expiration, but also during the policy period. Not many are aware that the cover can be dissolved during the policy period. The general assumption is the policy has to run through the entire period of one year. However, cancelling the two wheeler insurance policy comes with certain conditions. They are as follows.
- The cover can only be annulled if there are no claims made on the insured vehicle during the running policy term.
- The insured owner should have made arrangements for alternate coverage, at least for third party liability and should produce documentary evidence to support the insurance cover.
- In case of ownership transfer, existing policy cannot be cancelled unless provision of documentary evidence of alternative arrangement is made to support the insurance cover.
The bottom line is, you will not be able to cancel the insurance policy if you do not have an alternative insurance cover. The rule is that the vehicle should always be covered against liabilities.
Process of Cancel Two Wheeler Insurance Policy
The insured owner is required to provide a notice of 7 days to the insurer in writing, of their intention to cancel the policy.
- Contact the insurer, preferably by phone and express your intention to cancel the policy.
- Follow the procedure provided by the representative and ensure that you notify them officially in writing, at least 7 days in advance.
- Ensure availability of documentary evidence like the policy document if you bought an insurance policy for your two wheeler with a different insurer.
- Mail or fax it to the number or address provided. You may also be asked to drop the paperwork at the nearest branch.
- A minimum premium of Rs.100* will be retained by the insurance company and the balance will be refunded based on pro rata basis as per the timelines.
* Rs.25 in case of two wheelers designed/or modified for vehicles owned by blind/handicapped/mentally challenged owners.
Tip: If you’re contemplating on switching over to another insurer for your two wheeler for a lower premium, compare the benefits and features before making a decision to ensure that no compromise is made on these aspects.