Introduction
A coverage lapse after policy expiry happens when a car owner fails to renew insurance on time. Even if no accident occurs, the period without protection can affect your No Claim Discount (NCD), cancel add-on coverage, and increase out-of-pocket costs if an accident happens. This article explains common causes, the impact of a coverage lapse, and practical steps to ensure your insurance protection remains active.
1. What is a Coverage Lapse?
Coverage lapse happens when insurance policy expires & has not been renewed:
- You have no protection during the gap period.
- Coverage is not provided to vehicles at this period.
- Your NCD may drop one level or revert to 0% if the gap exceeds the allowed period.
BJAK Tip: Set an early reminder to renew before your policy expires and avoid a lapse.
2. The Impact of a Coverage Lapse
- No Financial Protection: No compensation for vehicle repair or coverage from insurer is provided for vehicle with expired policy.
- NCD Reduction: Having coverage gap will result in your NCD % decreasing if more than 1 year of no policy renewal.
- Claim Issues: Drivers will bear the full cost of repair when vehicle accident occur after policy expired.
3. How to Avoid a Coverage Lapse
- Check your policy and roadtax expiry dates regularly.
- Renew your insurance early, ideally 1–2 weeks before it expires.
- Use BJAK reminders to avoid forgetting renewal.
- Consider gap cover if renewal is delayed to protect your NCD and prevent a lapse.
Conclusion
A coverage lapse after policy expiry can reduce your NCD, cancel add-on coverage, and increase out-of-pocket costs if an accident occurs. By monitoring expiry dates, renewing on time, and using BJAK reminders or gap cover, you can keep your insurance protection active at all times. Understanding and following these steps ensures your car stays protected without the risk of high costs or losing your NCD.
Read More:
Roadtax Is Not Insurance — Know the Difference
