Finance ministry extends third-party insurance renewal to May 15
The Finance ministry of the government of India has issued a notification extending the policy renewal dates of motor insurance till May 15. The notification pertains to the mandatory third-party insurance cover only and does not include the comprehensive motor insurance policies.
The extension has been allowed to ensure continuity of the health insurance cover from the date on which the policy is due for renewal, so that any valid claim triggered during the period can be acknowledged. 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 that started from March 25 and has been extended to May 3 as of now. Driving the car with an expired insurance policy will also attract a fine of Rs 2,000.
Having said that, third-party policies only make up a small part of motor insurance as most car buyers opt for the comprehensive policies. The effect of lapse is much higher as significant benefits like no-claim bonus get cancelled if the policy has not been renewed before the due date. The government notification issues no guidelines on comprehensive policies and hence it is advisable to renew the policies online or by means that adhere to the lockdown regulations and also help maintain social distancing.