What is the grace period in car insurance?
Grace period for car insurance in India is an extra period of time given to policyholders by the insurance companies for paying their premiums on policy renewals without incurring a late fee or being dropped from the benefits of vehicle insurance.
What is the duration of the grace period?
The amount of time that a car insurance company may give you as a grace period varies. Generally, it is anywhere between 14 and 30 days, but it can differ depending on the insurance company you choose. Failing to make the payment beyond the grace period will further result in cancellation of your car insurance policy.
What are the benefits of the grace period?
An unexpected expense or a sudden change in finances can prevent an insured from making their payment on time. By giving customers the grace period, car insurers take into account these possibilities and provide an extra leeway for policyholders to pay their premiums.
Below are some of the most essential benefits of grace period offered by car insurance companies:
- One of the most important benefits of getting a grace period for your car insurance policy is that your no-claim bonuses are retained and you continue to receive the discounts on premiums as per the no-claim bonus accumulated over the years.
- Your policy remains active under the same terms and conditions as earlier, although no claims can be made during the grace period.
- The grace period should not be an excuse for not paying your car insurance premiums on time. Most insurers will look at the frequency of late payments – if you’re a frequently late payer, your insurer is likely to cancel your policy. And even if you don’t get cancelled, the cost of premiums may be increased or the sum assured could be reduced over time. Hence, it is best to pay your premium on time to avoid any of these complications.
Conclusion:
When shopping for car insurance online, it is advisable to discuss the grace period with the company before you commit to it. Don’t assume that all car insurance companies offer this option – some don’t. Ask them how long the grace period is, what happens after the period comes to an end without you making the payment, and what kind of penalties and charges you’ll incur if you don’t make the payment on time.
At the same time, it is also important to research different car insurance online and compare their options to get the best cover. Don’t forget to read their policies and check the grace period they are offering. Doing so will ensure that you get the best out of your car insurance policy and that you’re always prepared in case you can’t make the payment on time.
