Benefits of Multi-Year Car Insurance in the Long Run
Updated On Oct 15, 2023
Multi-year car insurance is a policy that gives coverage of up to three or five years. Every new car owner is mandatorily required to own at least a 3-year third-party car insurance as per the Indian Motor Tariff. Explore the benefits.
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Multi-year car insurance is a policy that gives coverage of up to three or five years. Every new car owner is mandatorily required to own at least a 3-year third-party car insurance as per the Indian Motor Tariff. Many old car owners also prefer buying a long-term car insurance policy owing to the host of benefits offered by it.
Benefits of Multi-Year Car Insurance
Following are the key benefits offered by a multi-year car insurance policy -
Saves You from Regular Renewals
Renewing your car with a multi-year car insurance policy can prevent the effort of yearly renewals, which may be a big headache. A multi-year car insurance policy keeps your car protected for the future.
It is Available At Relatively Lower Premiums
With an extended-term car insurance policy, you get to save lots of big on the premium amount. It's noticed that the premium for a multi-year plan is lesser than that of a one-year policy. Inflation causes premium rates to extend per annum by about 10-15%. Once you insure your car for an extended time, you save yourself against any such fluctuation. The policy provides an option for you to lock your premium for 3 years and evade the annual cost revision cycle. You even get upfront discounts from insurance companies for purchasing a long-term policy.
Helps You Avoid the Risk of Policy Lapse
It is a tenuous job to renew an expired car policy. When a policy lapses, it takes the entire process of inspection and IDV calculation out, this consumes immense time. Also, you might even need to pay a better amount thanks to the hike within the premium rates. A multi-year policy, however, removes this risk, allowing you to enjoy the advantages for up to three years with no hassles of renewal.
Benefit of No Claim Bonus
Do you know that you simply get rewarded for being a responsible driver? Yes! You get an incentive if you've not made any claims on your policy within the previous year. This incentive is called No Claim Bonus (NCB). Once you get a multi-year plan, you get an NCB of 20% at the time of policy renewal.
Avoid Penalties And Losses
According to the newest Motor Vehicle Act of India, riding on an uninsured car is an offense. Also, if you face any untoward incident where you would like to file a claim, an uninsured policy will be a waste. If traffic police catch you, you might need to pay a hefty fine for your ignorance.
Easy Policy Cancellation
A long-term car policy is often canceled anytime you would like. There is no hard and fast rule to continue with the policy for the whole tenure. If you think you'll get a far better plan, you'll withdraw from the policy. Under the multi-year policy, the insurer will return you the unused premium amount. If you would like to keep the NCB from your previous plan, then you ought to buy a replacement policy before withdrawing from the prevailing one.
It is very challenging to remember everything in this busy world. We often forget the renewal date. Now that you are aware of all these benefits of the multi-year car insurance policy, we are sure that you will choose it the next time you renew your car insurance.
Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.