Amid our busy schedule and day-today lifestyle, there is a possibility to forget the renewal of our motor insurance policy. Thanks to the Supreme court’s order and notification circulated by IRDAI last year, which mandates all the insurance companies to issue 3year Third party insurance cover for new cars and 5year third party insurance for newly purchased 2-wheeler bundled with 1year constant Own Damage component.
Insurance policies were issued on yearly basis, before IRDAI circulated the norm to all the insurance companies for issuing third party policy for extended years. After the revised fines and amendments done in Motor Vehicle Act in 2019, effective in India from 1st Sept 2019, all the drivers have become more conscious and serious about traffic rules, fines and insurance.
To avoid unnecessary traffic police intervention while plying on road, people are opting for a simple way which will help them in a long run. One of the factors where defaulters are caught is – ‘driving without insurance’. Earlier renewal of insurance policy annually was a painful task for customers. As per the Supreme court’s order and notification circulated by IRDAI, it is compulsory for all the motor insurance companies to give long term, third party insurance policies, bundled with OD component to customers on purchase of new vehicle. Here are the benefits of opting for a long-term policy for your vehicle-
Benefits of taking a long- term policy:
Depending on the coverage of insurance, insurance companies offer more discounts to those who want to go for multi-year/ long term insurance policy. It’s a win-win situation for both the parties. Offering discounts keeps the insured happy and insurer’s administrative costs comes down.
- Helps in Saving by availing Discount offered by insurance companies
Purchasing a long-term insurance for your vehicle not only refrain you from unnecessary burden of year-on-year renewal, but also saves you away from the yearly hike, which is very likely.
- Protects you from yearly hikes
Availing a long-term insurance is convenient and hassle-free. The insurer need not to put yearly reminder to customers. At the same time, insured’s mind is free from remembering the renewal date year on year.
- Convenient for Insured and insurance companies
Having a long-term insurance for your vehicle gives you a leverage to change your insurer in case you are not happy with the services. Which means, if you have purchased a new vehicle after 1st Sept 2019, you are liable to get a Third-party insurance for 3 and 5 years for bike and car respectively. Insurance will come bundled with Own Damage* cover for 1 year. In case you want to change your insurer because of unsatisfactory services, you can go for another insurer. *Please note that one can only go for a change if the OD component is taken for 1 year.
- Own Damage Component
Most insurance companies have welcomed the changes and for some it is still a subject of argument. This was all about insurance related purchase of new vehicles from 1st Sept 2019. Now here arise a question, how should vehicle owners renew policy for the existing vehicle that they are driving? And the answer is they can continue with their existing renewal process. They can renew their policy by either buying 1 year comprehensive cover (inclusive of OD and 3rd party cover).
Note* Renew your bike insurance policy with RenewBuy.