Consequences of 3 Year Third-Party Insurance for New Vehicles

Ongoing Insurance Law introduced in Sep'2018, applicable to new vehicle purchases.

3 Year Third Party Insurance with 1 Year Own Damage Vehicle Insurance for New Cars.

5 Year Third Party Insurance with 1 Year Own Damage Vehicle Insurance for New 2 Wheelers.

Recent problems faced by citizens under this law: -

·????????Break-in vehicle insurance: There can be a gap in my understanding, but around approx. 20% of vehicles (Please do not Debate or Comment, this % can be slightly less or large) are not insured timely i.e., the vehicles have break-in insurance. And it can happen, whatsoever the reason may be (Please do not Debate or Comment).

If even One Citizen Suffers, the Rule requires Revision / Reconsideration.

Please read / Think / Analyse / Debate / Comment as Common Citizen of India only.


Let us analyze the consequences of this.

-??????Initially complete insurance lapsed and the owner knows the legality.

-??????Now only Own Damage insurance lapses in First Year or Second Year as the case may be.

-??????This creates an innocent unwanted gap in the Third Party Insurance period and the Own Damage Insurance period at the end of 3 Year Third Party Insurance.

-??????Third-Party Insurance ends at Stage One and the user is unaware because he has an Only Own Damage policy with him, which is yet to expire in the future.

-??????The user has confidence that his vehicle is insured without knowing the technical terms, such as Third-Party insurance or Own Damage insurance (Initially Comprehensive, a combination of both) ?

-??????So, Common Citizens of India are innocently unaware of how much risk their vehicle and they themselves are in for any third-party losses on road.

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Now / Solution:

-??????Suggestion and request to the Government to stop this process for future.

-??????Introduce a Short Period Third-Party Vehicle Insurance Option on Top Priority for Such cases only to cover the gap.

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A Case Study for further clarity:

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At the time of First Insurance for New Vehicle:

Third-Party Insurance Policy Period (3 Years): 11 Sep 2018 to 10 Sep 2021

Own Damage Insurance Policy Period (1 Year): 11 Sep 2018 to 10 Sep 2019

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At the end of 3 Years i.e., on 10 Sep 2021, for vehicles with Break in insurance:

The gap in Third-Party / Own Damage insurance policies: It can be from 1 Day to 6 Months.

But just for an example, we take it around, say 60 Days.

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Status of the vehicle insurance as on 10 Sep 2021,

Third-Party Insurance Policy Period (3 Years) Expires on 10 Sep 2021

Own Damage Insurance Policy Period (1 Year) still to expire on 10 Nov 2021

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Now stop for a while and have serious thought.

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The owner of the Vehicle is innocently unaware of

-??????Vehicle does not have insurance to move on Road from 11 Sep 2021 to 10 Nov 2021.

-??????Vehicle does not have Third Party insurance for the period.

-??????Vehicle is not having insurance for Third-Party Losses.

-??????If Third-Party loss occurs, he will have to cover the loss from his pocket, which he may not be able to afford, causing the Owner of the vehicle and His Family unbearable suffering.

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How to renew such policies expiring in coming future months, going to be a regular requirement?

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Renewal Suggestion: 1 (The best Solution)

The Third-Party policy period is to be endorsed from 11 Sep 2021 to 10 Nov 2021, by charging a premium on a short period or pro-rata basis as applicable.

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Query: Can this be done as per available Norms?

Answer: Introduce Short Period Third-Party Vehicle Insurance Option.

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Renewal Suggestion: 2 (Solution requires a thought)

Renew Policy from 11 Sep 2021 to avoid?any liability due to non-availability of Third-Party liability coverage.

Query: How to give No Claim Bonus benefits?without?completing one complete year of own?damage policy period?

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Renewal Suggestion: 3 (This is never a recommended solution)

If Renewal Suggestions 1 and 2 are not acceptable,

- Inform the client before 10 Sep 2021, that he will be moving with his vehicle on road without Third-Party Coverage w.e.f. 11 Sep 2021 to 10 Nov 2021.

- Renew the policy as comprehensive w.e.f. 11 Nov 2021.

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Renewal Suggestion: 4 (The forced Solution and is an unethical?Solution)

-??????Suggest the client not to move on Road without Third-Party Policy from 11 Sep 2021 to 10 ??

Nov 2021.

?????- ?????Renew the policy w.e.f. 11 Nov 2021.

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The query for Suggestions 3 and 4: The acceptance?of these solutions by any of the?insured is doubtful. Also please check that approved Renewal Terms and conditions may or may not allow this, to renew a policy without a Third-Party coverage policy.?

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Renewal Suggestion: 5 (A harassment as a consequence of the law)

-??????Suggest the client get only Third-Party Policy from 11 Sep 2021 and do Only Own Damage Policy from 11 Nov 2021.

-??????Do maintain 2 no insurances working separately for future years for one vehicle.

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Query: This can be called “Forced Consequence of the Law”.

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Finally, please do not Criticise / Give Some Time / Think of a Solution / Influence the Government / considering the best for the Insured – Common Citizen of India.?

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Only Solution:

-??????Suggestion and request to the Government to stop this process for future vehicle purchases.

-??????Introduce a Short Period Third-Party Vehicle Insurance Option on Top Priority for Such cases only to cover the gap.

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Query: How the Common Citizen of India is Benefited by this Law?

-??????Think / Analyse / Debate / Comment as Common Citizen of India only.

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