The government of India has extended the renewal period of third party car insurance policies to May 15 as per the notification issued by the ministry of finance. The extension of renewal will allow car owners to use their cars in case of emergency. Even if the policy expires in the lockdown period. The lockdown started from March 25 and has been extended to May 3 as of now.
What exactly does this extended insurance policy mean?
The decision has been taken to ensure continuity of insurance cover from the date of policy renewal. This means that any valid claim triggered during the period can be acknowledged. It should also be a safeguard against the fine of Rs 2000 for driving a car without a valid insurance policy in this period.
The notification pertains to the mandatory third party cover only. It does not include the comprehensive motor insurance policies. As it is, new vehicles come with a five year insurance policy. Most of the companies offer a comprehensive cover for the first three years and thereon a third party.
But, when it comes to motor insurance, most of the customers opt for comprehensive policies. These policies will lapse if not renewed in the time-slot and will also lead to loss of no-claim bonus which is a significant saving when it comes to the insurance premium. The notification has not included comprehensive policies and hence it is advisable to renew the policies during the stipulated time.
The lockdown has severely affected the auto industry. Not only are sales down but manufacturing too has stopped. All this when the cleaner BS-VI norms have just come in. Sale date of BS-IV vehicles too has been extended. However it looks like there is a bit of ambiguity as of now due to the extended lockdown.
PS: Policies these days are renewed online. The extension could be for those who forget to renew.