Grace period is the additional time allowed by your insurance provider for you to renew the policy and pay premium. Just like grace marks allow you to pass if your grades in a particular subject are below the passing level, grace period gives you a few days after the policy renewal due date, for you to pay the renewal premium.
The points to remember in case of two wheeler insurance policy renewal are:
- Grace period for two-wheeler insurance: Two-wheeler insurance of any sort usually does not allow any grace period. This means that if a policy reaches renewal due date and you fail to pay the premium on time, the policy will lapse. This will impact the benefits available from a motor insurance policy as well as the price of the next policy that you buy.
- Government rules: The reason two-wheeler insurance does not offer grace periods is that a vehicle should be covered by insurance – at least a third party liability insurance – at all times as per government rules. This helps you claim insurance benefits in case of accidents on any given day of a year. The insurance policy covers not just damage to your vehicle but also the damage caused to another vehicle or injury and death of its driver in case of a collision.
- Inspection: Once the policy expires, renewal would require an inspection of the vehicle by authorised personnel, even if it is only 1 day late. You will have to pay the inspection charges as well.
- No Claims Bonus: If you own a comprehensive motor insurance policy and it is not renewed up to 3 months after lapse, the No Claims Bonus (NCB) gathered will expire. NCB is a discount on premium of damaged caused by yourself on your two-wheeler when you renew your policy. This is applicable only if you have made no claim in the last 1 year of your policy. NCB can be availed even if you transfer your policy from one insurance provider to another.
- Two Wheeler Insurance Online Renewal: Your motor insurance policy can be renewed either online or offline, which makes it very convenient. Online renewal will hardly take 15 minutes of your time and involves hardly any paperwork or physical inspection. You can also opt for longer-term policies such as a 3-year policy to save on premium.