Break-in Period in Car Insurance Explained
Break-in Period in Car Insurance Explained

When it comes to understanding technical terms and jargon related to car insurance, we are often at a loss. But it is important to know and comprehend exactly what we are signing up for. These are the details that define the kind of coverage our policy will provide in case we are in a car accident.
One such term is Break-in Period and in this article we will help you demystify what exactly a break-in period for car insurance is and why it is important to know about it before buying a car insurance policy.
What is a Break-in Period for Car Insurance?
A break-in period in car insurance is the time between the last date for renewal of car insurance and the date on which you renew the policy. For example, your policy renewal date is January 1 and you get it renewed on January 30, then the 30-day gap in between will be known as the break-in period. Your motor policy remains inactive during this time and if your vehicle faces any damage during this period, it will not be covered under the policy.
Myths About Car Insurance Break-in Period
Some of the common myths around car insurance break-in period are as follows:
Myth 1: The policy can't be renewed during the break-in period
You can renew your insurance policy during the break-in Period. If you do not renew it within 90 days, you will lose NCB and other benefits.
Myth 2: You can't avail of NCB discounts
If you renew the car insurance policy within the 90-day break-in period, you will be eligible for the NCB discounts. However, if you delay it further, you won't get the accumulated NCB discounts.
Myth 3: Can raise claims during the break-in period
The policy is inactive during the break-in period, and therefore no claims can't be raised. If you want to raise claims, you will have to renew the policy coverage.
Myth 4: Voluntary deductibles will also be applicable along with compulsory deductibles
Deductible refers to the fixed amount of repair cost which must be paid from your pocket. The two types of deductibles include compulsory and voluntary. When you renew the policy, you will have to know that only compulsory deductibles will be applicable and not voluntary ones.
What Happens if You Do Not Renew Your Car Insurance During Break-in Period?
Most insurance companies in India provide a grace period of 90 days during which you can renew your car insurance policy. That is the maximum allowed ‘break-in period’ is of 90 days. During the break-in period, you are still eligible for benefits like No Claim Bonus (NCB), which can reduce your policy premium by as much as 50%.
However, once the window of 90 days is gone, you will lose all the accumulated benefits. Your motor insurance policy will lapse. You will then have to start everything from the beginning and the IDV of your vehicle will be decided after its re-inspection. Policy purchased after 90 days is treated as a completely new policy and all the discounts and NCBs collected will expire.
Disadvantages of a Break-in Period in Motor Insurance
The disadvantages of a break-in period for vehicle insurance are as follows:
Financial security
Car insurance is meant to protect yourself against financial losses due to accidental damage. If the car gets damaged during the break-in period, you will have to bear the charges of financial burden. Therefore, it is advisable that you renew the insurance policy in time.
Legal issues
The Motor Vehicles Act 1988 makes it mandatory for vehicle owners to have a third party car insurance. If you are driving without valid insurance, and the third party becomes injured due to an accident, you will have to face legal problems. It is important that you renew the third party car insurance online to make it easier.
Benefits of Renewing Car Insurance Policy On Time
There are many benefits of renewing the car insurance policy on time. The first and the most important benefit is that your car is insured all the time. There are no gaps and no break-in period.
And as mentioned above, you get NCB for every claim-free year. The good thing is the value of NCB increased with each renewal – from 10% after the first year to 50% at the end of the fifth year and more. And if you are selling off your old vehicle and buying a new one, some insurance companies even allow the transfer of NCBs to the new vehicle’s policy.
Considering that it is mandated by law to have a car insurance for every car owner, an expired third party car insurance policy also makes you liable against legal charges. Therefore, it only makes to renew your car insurance policy on time without waiting for the break-in period.
Given the losses and complications one faces towards renewing a lapsed car insurance policy, it clearly makes sense to renew it on time. And if at all you forget to do so, you must do it within the allowed break-in period in car insurance, especially when all it takes for a car insurance policy is a few simple steps online.
Nowadays, you can even opt for receiving notifications for policy renewal date through emails and SMS alerts. So do not wait until the break-in period to renew your policy. Renew it well on time to enjoy all the benefits and discounts that come along.
FAQs
1. What is the break-in period of car insurance?
The break-in period of car insurance is usually three months. It is advisable to renew the car insurance within these 90 days.
2. What is the policy period for car insurance?
The duration of the car insurance is usually the policy period. The duration is usually from the date of inception to the date of expiry for the policy.
3. Can I apply for car insurance online?
Yes, you can definitely apply for car insurance online. It is advisable that you submit all the documents with the right paperwork. You must maintain complete accuracy in all the details to avoid any discrepancies.
Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales.
RELATED ARTICLES
Grace Period in Car Insurance & Its Importance
Everything About Car Insurance Renewal
Why You Should Not Miss Your Car Insurance Renewal Date
Renewal Steps For Car Insurance
Still Driving Your Car with a Lapsed Insurance Policy? Here’s What You Should Know