Driving an uninsured vehicle can be extremely dangerous. For starters, you run the danger of incurring expensive costs in the event of an accident. Second, and this cannot be overstated, driving a car without insurance is prohibited in every state in India, according to the most recent Motor Vehicle Act of 2019. As a result, investing in a solid long-term Car Insurance Policy makes perfect sense. The advantages of doing so are listed below.
A brief background of the latest legislative changes
Previously, Indian legislation required that every Car Insurance policy be valid for one year from the date of policy renewal. However, a Supreme Court decision in 2018 rewrote the law and mandated that new Car Insurance Policies cover third-party liabilities for three years. In other words, the Supreme Court ruled that autos have a 3-year insurance policy and two-wheelers receive a 5-year insurance policy. Third-party liability coverage is good for three years, whereas regular Car Insurance can be renewed annually. This is also known as a multi-year car insurance policy or a long-term car insurance policy.
As a result of this legal reform, it became rather inconvenient for individuals to carry two separate types of Motor Insurance with distinct expiry dates. To address this issue, Indians began seeking to organizations like as ICICI Bank, which offer long-term motor insurance policies such as the ICICI Lombard General Insurance.
The Advantages of a Long-Term Car Insurance Policy
Discounts: Insurance companies understand how expensive long-term car insurance policies may be. Thus, to cut the price a little, they give interesting discounts and offers to their customers utilizing the money saved from the lower administrative and policy issuing costs associated with this type of insurance. Furthermore, if you have an anti-theft device installed in your car, are a special needs driver, or a member of a reputable automobile corporation, you may be eligible for additional premium discounts.
Convenience: As previously said, it can be difficult to keep track of the several insurance renewals you must complete with their various expiry dates. Long-term car insurance policies make your life as simple as the renewal date, as it just needs to be renewed every three years.
No Claim Bonus (NCB): An NCB is a discount on your insurance premium that you can use whenever you choose. With a long-term automobile Insurance Policy, you can not only get a greater NCB than with a conventional Car Insurance Policy, but you can also easily transfer your NCB to a new automobile if you decide to buy another one.
Saves Time and Effort: Certain short-term insurance policies demand the insurance holder to submit an inspected review of your vehicle at the time of annual renewal. Long-term car insurance policies spare you the time and trouble of having to go through this process.
Change in Policy: Some insurance policies change over time, requiring individuals to pay a higher price upon each renewal. Renewing your insurance after three years will allow you to avoid paying the additional rate. This price increase protection will help you save 20% to 40% of the money you would have spent on your annual third party renewal.
Reducing Non-Renewal Risks: If you are in the unfortunate scenario of having to repair or replace a portion of your car after your insurance grace period has expired, you will have to incur the costs out of your own money. However, with a three-year Car Insurance policy, you have a lower risk of having to cover expenses on your own because you have a longer time frame in which to make repairs or replacements.
Conclusion
A long-term Car Insurance Policy will always be worth every penny you pay. Although it is somewhat more expensive than a standard one-year Car Insurance Policy, with all of the perks that come with it, it is well worth considering.