As a car owner, it’s important to understand that valid insurance and road tax coverage are necessary for driving on public roads. Failing to renew your car insurance could result in serious consequences that you don’t want to face. Let’s explore some of the risks you may encounter by not renewing your car insurance in this article.
Is it an offence to not renew car insurance?
YES! You need insurance to ensure that you can renew your road tax and legally use your vehicle on the road as stipulated under the Road Transport Act 1987. If you don’t have insurance, you will fail to renew your road tax as it cannot be processed.
Driving without valid insurance puts your life as a driver, your vehicle, and other road users at high risk, especially in the event of an accident.
The consequences of not renewing car insurance
Delaying or choosing not to renew your car insurance can expose both you and your vehicle to various risks, including:
Fines and summons
Yes, getting fined by the authorities is the most common consequence or risk you’ll face if you fail to get valid car insurance protection. As authorities conduct roadblocks every day, the risk of getting fined or summoned is even greater. Especially if they find that the road tax displayed on the left corner of your car’s front mirror has expired.
Trouble renewing road tax
It’s essential to remember that your road tax and auto insurance go hand in hand. Don’t forget that without valid insurance, you won’t be able to renew your road tax at the Road Transport Department (JPJ). Plus, Section 14(4) of the Road Transportation Act (RTA) 1987 states if you’re caught driving without it, you could face a hefty fine of RM3,000! Keep in mind that you typically have to renew both your road tax and insurance simultaneously. So, it’s best to sort them out on the same day.
No-Claim Discount (NCD) is at risk of decreasing
Every NCD is only valid for a period of one year. Failing to renew your insurance on time (more than a year) will cause your car’s NCD to decrease gradually each year you don’t renew your car insurance. For example, if your car’s NCD was previously at 55%, after a year of not renewing your insurance, your NCD will decrease to 45% and will continue to decrease until you renew it.
Remember, every NCD is only valid for one year, and if you fail to renew it, your discount will decrease each year. So, if your car’s NCD was 55%, and you don’t renew your insurance for a year, it will drop to 45%.
Insurance lapse
It happens when you forget to renew your motor insurance or fail to make payments on time. And when your coverage is deficient, the insurance company will not protect you for a certain period.
But before you panic, here’s some good news: insurance companies usually offer a grace period to policyholders to pay their premiums and avoid a lapse in coverage. The length of this grace period may vary depending on your provider. So be sure to double-check with them to avoid any unwanted surprises.
Remember, letting your insurance lapse is not only risky but also illegal in many places, so stay on top of your payments and make sure you’re always protected on the road.
Financial troubles
Don’t get caught with a heavy financial burden! If you fail to renew your car insurance on time, you could be putting yourself at risk for even more trouble. It might seem like skipping insurance payments could save you some cash, but that’s far from the truth.
Without insurance protection, any damages to your car caused by an accident will be entirely your responsibility. That means you’ll have to pay out of your own pocket and let’s face it, the costs can skyrocket.
What do you need to do?
Make sure your vehicle is protected by insurance as soon as possible. Don’t procrastinate renewing your car insurance as it won’t provide any benefits or advantages. Renew your insurance according to the appropriate time period to prevent incidents like those mentioned above.
Your insurance policy is your best friend in times of need. Make sure you protect your vehicle and yourself by staying up-to-date. Don’t wait until it’s too late to insure your ride!
Bjak is one of Malaysia’s biggest insurance comparison websites, offering policies from over 10 brands. Get your free insurance quote from Bjak today!
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