Car Insurance is valid only for 13 months - Know Why

If you are searching for the best car insurance around the UAE then you should have been aware that car insurance is valid only for 13 months. Generally, the car insurance is valid only for 12 months adding the grace period of one month extra which is 13 months. 

The UAE government's RTA has issued this one-month grace period which is allowed for the renewal of car insurance. This additional month is a penalty-free month where you are allowed to renew car insurance. 

Many experts suggest that the policy-holder should renew car insurance before the grace period expires. This will help you to avoid paying penalties and getting into legal trouble if you are hit with an accident. 

If the car is not registered then the legal authorities will impose a penalty and this penalty will be calculated daily where each day fine is calculated for the number of days the car remains unregistered. 

If you want to sell your car and car insurance is nearing to expire then you can make the best use of the grace period. During the grace period, you can renew car insurance and make arrangements for selling your car. Until you get the potential buyers the grace period can be best utilized. 

The car insurance policies are valid for 13 months to keep you moving on the roads and to provide a cushion of time for renewing the car insurance. Always remember to renew before the expiry of the 13 months otherwise you will be levied with heavy penalties. 

How is car insurance premium estimated?

There are many different factors that are considered for calculating car insurance and these factors are age, insurance validity period, car model, year of car purchase and other factors. 

Insurance companies will consider all these factors and also consider the premium based on 12 months. Insurance companies will consider an insurance period of 12 months in calculating the premium. They will not consider the grace period of one month during the estimation of the insurance premium. One month given by the RTA is free and you get the benefit of insurance coverage during that period. 

What is the right time to renew car insurance?

The extra month given to the car owner is the right time to renew your car insurance. This is the additional time that is offered to get car insurance. It is important to note that an additional one month is especially for car insurance renewal.

The car insurance company will keep reminding you to get car insurance right from the 12th month. Look into your car insurance expiry and select the right time for car insurance renewal. 

What will happen if you do not renew before the grace period?

If you are not able to renew during the grace period then it is better to renew in the 12th month. Even if you miss out on renewing in the grace period then you have no option but to buy the insurance policy again. This is a very rare case as the insurance company will keep following up with you regarding the insurance renewal. 

There are systems of auto-renew options where you can give the insurance company and the bank standing instructions to renew the car insurance as per the timeline. Even if you are busy, the auto-renew option that you select will keep the insurance policy moving. 

If you are renewing after the grace period then you will lose no claim bonus benefits. If the insurance plan expires and you do not renew even in the grace period then the accumulated no claim bonus points will expire. However, if you reactivated car insurance within the 90 days then no claim bonus will not expire. There is a huge penalty if you are driving without  car insurance.

A penalty of AED 500 and 4 black points will be added to your driving license. The Car will be seized by the officials for 7 days. If the car is hit in an accident and if there is no valid insurance then huge penalties will be imposed. Legal actions will also be taken depending upon the severity of the accident. 

Take away

The extra month given by the RTA is for the renewal of the insurance. Make the best use of the free insurance period to renew the car insurance. The insurance companies will send reminders for the renewal of car insurance. This will give you ample time for renewal during this period, keep doing your best research and find out the best car insurance which is suitable for you. Compare the insurance prices of different policies and purchase the right insurance. Without any hassles transition of insurance can happen during the grace period.