personal finance

Date for renewal of health, motor insurance policies extended to April 21


The ministry of finance issued notifications on April 1, 2020, stating that the renewal dates of health and motor insurance policies which fall in the period from March 25, 2020, to April 14, 2020, are extended till April 21, 2020 due to coronavirus lockdown.

This extension is important because normally these insurance policies cease to be in force if not renewed on renewal date. Generally, in case of health insurance, there is a grace period for renewal, but the policy is not in force during this time period till renewed. Normally, third party motor insurance lapses if not renewed on due date and the vehicle owner can become liable to pay penalty and 3rd party damage compensation on his own.

This means that your existing policies which are falling due for renewal from March 25, 2020, to April 14, 2020, can be renewed uptill April 21, 2020.

Normally, in case of health insurance, if a policy holder fails to pay the premium by the renewal date he/she gets a certain grace period to pay it. The policy can be renewed by paying the renewal premium during this grace period. However, during the grace period (till policy is renewed) the policyholder is not covered/insured and cannot file any claim for any medical or health event/accident/treatment taken during the grace period. Also, the insurance company can ask the insured to undergo a medical test/check up before renewing the policy during grace period.

Third-party motor insurance

If your current compulsory third-party insurance policy is expiring between March 25, 2020, and April 14, 2020, and you are not able to renew your policy because of country-wide lockdown then you can renew such motor insurance policy by April 21, 2020.

According to the notification issued by Ministry of Finance, “The policyholders whose motor vehicle third party insurance policies fall due for renewal during the period on and from the 25th March 2020 up to the 14th April 2020 and who are unable to make payment of their renewal premium on time in view of the prevailing situation in the country as a result of Corona Virus disease (COVID-19), are allowed to make such payment for renewal of policies to their insurers on or before the 21st April 2020 to ensure continuity of the statutory motor vehicle third party insurance cover from the date on which the policy falls due for renewal.”

Failing to renew motor insurance policy on due date

Normally, if you don’t renew your third party insurance on the due date then the policy expires. If this happens then you can be fined Rs 2000 for driving a vehicle without third party insurance under the Motor Vehicles (Amendment) Act. Worse, in case of damage to a third party -some else’s car, property – or death of a third party (person) during the period when the 3rd party insurance is not in force, you would be liable to pay entire compensation on your own.

Regular health insurance policy

Similarly, if your health insurance policy is expiring and is due for renewal in the period from March 25, 2020, to April 14, 2020, you can renew your policy by April 21, 2020.

As per the notification,” The policyholders whose health insurance policies fall due for renewal during the period on and from the 25th March 2020 to the 14th April 2020 and who are unable to make payment of their renewal premium on time in view of the prevailing situation in the country as a result of Corona Virus disease (COVID-19), are allowed to make such payment for renewal of policies to their insurers on or before the 21st April 2020 to ensure continuity of the health insurance cover from the date on which the policy falls due for renewal.”

Failing to renew your health insurance policy on due date

Normally, if you fail to renew your health insurance policy on time, a 15 to 30-day grace period is provided to pay the premium dues. If still you have not made premium payment within the grace period, then your policy lapses. After that you will have to buy a new policy which will not include any of your earned bonuses (like No Claim Bonus) and moreover, you will have to go through a waiting period for certain illnesses again. Hence, you must remember to renew the policy on or before the due date.





READ SOURCE

Leave a Reply

This website uses cookies. By continuing to use this site, you accept our use of cookies.