Owning a two-wheeler in India offers convenience and freedom, but also entails a set of legal responsibilities. Among them, the most critical responsibility is to follow the traffic laws. To enforce these laws, the government issues traffic challans as penalties for different violations.

However, beyond the immediate financial loss, e-challans can have long-term impacts on your bike insurance if you fail to pay it on time. Read more to know why bike owners must keep a clean record and how periodic tracking of e-challans helps in doing that.

How E-Challan History and Pending Challans Affect Your Bike Insurance Policy?

For a few years now, insurers have been checking their customers’ background, including their challan history and pending challans, before finalising the insurance premium. They do this to have a perception of risk associated with that policyholder. Let’s understand how multiple e-challans will affect your bike insurance policy.

1. Increases the Risk for Insurance Companies

Traffic laws are meant to reduce accidents and maintain traffic flow. Violating them increases the risk of accidents. Hence, providing an insurance policy to people with multiple challans issued in their name is riskier for the insurer than providing it to a safe driver.

2. Increase in Bike Insurance Premiums

The tolerance for the extra risk comes at a cost. The insurance price for frequent violators is far more than that for safe drivers. However, this premium increase applies only when you buy a comprehensive bike insurance policy. This is because IRDAI fixes the third-party insurance premium.

3. Stricter Policy

Sometimes, the repercussions of having excess records of violations and unpaid challans do not stop at “just a premium hike”. In such cases, the insurer still agrees to provide an insurance policy, but with stricter terms. They might include limited coverage availability and a higher voluntary deductible.

4. Cancellation Of Running Insurance Policy

Suppose a policyholder commits a significant violation of traffic laws, such as causing an accident while drunk driving, the policyholder’s coverage may be terminated. Such incidents significantly alter their risk profile. Under these grounds, the insurer can sabotage its existing insurance policy with them.

How Tracking E-Challans Helps Maintain Bike Insurance Benefits?

The e-challan system issues e-challans directly to your phone for breaking a traffic law. For example, if a person from West Bengal jumps a traffic signal, then the system will automatically detect the violation and issue an e challan west bengal on their number.

Hence, it is essential to track your e-challans periodically to know your liabilities. Read more to understand how monitoring e-challans can help maintain a healthy bike insurance policy.

1. Avoid Legal Trouble

Having pending e-challans for more than 90 days can result in suspension of the driving license. Tracking your e-challans will remind you to pay them on time.

2. Ensure Faster Claims

Periodically tracking your e-challan helps you to keep a clear record. And having a clear record makes claim disbursement easier.

3. Facilitates Smooth Resale

Having pending challans can delay or block your resale process if you are trying to sell your vehicle. Periodic tracking of challans can allow you to pay off your piled-up e-challans slowly.

4. Lower insurance Price

Periodically tracking your bike’s e-challan helps you maintain a clean record. People with a clean record can leverage their low risk to negotiate a lower premium.

How Unpaid E-Challans Affect Your Bike Insurance Claim Process?

During a claim, the insurer verifies the incident details and assesses the claim’s authenticity. The insurer also verifies whether the policyholder violated the law at the time of the accident. Among them, if the insurer finds out records of traffic violations in your name and multiple unpaid challans. The following issues might come up.

• The insurer might dig deeper into the matter due to heightened suspicion. This can slow down the claim process.
• If the accident resulted from a violation by the insured, the entire claim may be rejected.
• Even third-party claims will be scrutinised if the vehicle owner failed to comply with traffic rules.

The Bottom Line

Traffic violations can directly affect your driving record and increase your bike insurance premiums. And leaving these challans unpaid can lead to multiple other complications, including suspension/cancellation of the driver’s license and issues at the time of car registration number transfer.

On the other hand, you can reduce the impact of e-challans simply by tracking and paying them and keeping a clean driving record. Installing a GPS tracker can also help reduce your overcharged insurance premiums.