What you should know about a lapsed two wheeler insurance plan

Two-wheeler insurance is an important financial instrument that protects your bike from situations like accidents, calamities, theft, etc. But it also comes with an obligation to timely renew two wheeler insurance. If you are unable to renew your two-wheeler insurance, be it comprehensive bike insurance or third-party insurance, it will get terminated. Then, not only will new two-wheeler insurance has to be purchased but also the termination comes with its own set of consequences. Furthermore, it is a legal mandate that you can ride your bike without a valid insurance policy. 

Meaning of a lapsed two-wheeler insurance policy

Usually, the validity of a two-wheeler insurance policy is of one year. In the case of a multi-year two-wheeler insurance policy, the plan remains active for 2-3 years, depending on the outlined tenure of the policy. However, every two-wheeler insurance needs to be renewed periodically. 

If you are unable to renew your two-wheeler insurance policy on time, it will be termed a “lapsed two-wheeler insurance policy.” It is basically equal to having no insurance policy. Failing to renew the two wheeler insurance policy within its due time leaves the policy void. Thus, you are no longer covered under a two-wheeler insurance policy. 

Consequences of a lapsed insurance policy

If you fail to renew two wheeler insurance on time, you will have a grace period of 90 days, enabling you to keep the benefits of your policy like No Claim Bonus, etc. But in case you still fail to renew two wheeler insurance, there could be the following consequences:

• No coverage: If you do not renew the two wheeler insurance policy within the grace period, your insurance policy will have lapsed. In such a situation, if you meet with any accident or there is any damage to your two-wheeler or any bodily injury – none of it will be covered. Subsequently, you will have to bear all the expenses out of your pocket.
• Loss of No Claim Bonus: If you are eligible for the benefits of the No Claim Bonus, your failure to renew your two-wheeler insurance will result in this benefit being forfeited. A No Claim Bonus can significantly reduce your insurance premium, and losing it means losing this advantage.
• Insurance premium might be increased: Another significant consequence of your failure to renew two wheeler insurance on time is that your insurance provider may raise your premium beginning with the next cycle.
• No cushion against third-party liabilities: In case your insurance policy has lapsed, and your two-wheeler meets with an accident, you will have to bear all the costs and damages incurred by third parties.

Hence, ideally, you should be renewing your lapsed insurance policy on time; otherwise, you risk losing your benefits and might also be incurring greater expenses.

Reinstating your lapsed insurance policy

You can reinstate your lapsed two-wheeler insurance within the grace period of 90 days. If the period of 90 days has not ended, then to reinstate your policy, get in touch with your insurance provider. Depending on the number of days lapsed, your insurance provider may renew it with or without penalty. In the event that you are unable to do so, your insurance policy will expire.

What to do if your two-wheeler insurance lapses?

If your policy has expired, you can easily renew it either online or offline.

To renew your two-wheeler insurance online, be it comprehensive bike insurance or third-party insurance, follow the following steps:

1. Ensure that the requisite documents, like policy details and your vehicle’s registration number, are handy.
2. The next step involves logging into the website of your existing insurance company.
3. Go to the renewal option and enter the requisite details.
4. The next step involves making payment online through either your debit or credit card, NEFT, IMPS, RTGS, etc.

After following these steps, your policy will be renewed.

To renew two wheeler insurance offline, the steps are:

In this case, visit the office of your insurance provider. Make sure you carry all the requisite documents with you, like policy details, the registration number of your two-wheeler, etc. The insurer will initiate the process of renewal. Make the required payment, and you will be able to renew two wheeler insurance. Some insurance providers have a mandatory policy of inspecting your vehicles before renewing your insurance, so that might also be done.

Hence, while you can renew your policy both online and offline, the online method is far more efficient and convenient, saving you time and effort as compared to doing so offline.

Points to keep in mind

Ideally, you should ensure that your two-wheeler insurance is renewed on time and does not lapse. One simple way to accomplish this is to obtain a long-term third-party or comprehensive bike insurance policy that does not require you to renew it on a regular basis. There are policies that can provide coverage for your vehicle for as long as 3 years. These policies come with their own sets of benefits-

• There is no need to renew again and again, saving you time and avoiding hassles.
• Protects you from annual changes in interest rates.

You cannot drive your two-wheeler without insurance in India. At least third-party bike insurance is mandatory as per the provisions of the Motor Vehicles Act, although comprehensive bike insurance offers a greater level of protection. With a policy comes the need to renew two wheeler insurance. If you are unable to renew your policy on time, it will lapse. This would mean that you would not only lose the protection that comes with insurance but would also lose benefits like the NCB. Hence, it is pertinent that you renew your vehicle insurance on time.

Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales.