I've renewed licence 3 times now they always send documents out and ask for the correspondence a good 8-12 weeks in advance in the hope they get your new license to you before the old one actually runs out, and yes unless told otherwise you can still drive. I always keep a photocopy of back and front of licence on me incase I need it, which I did this year to hire a car while other was in for MOT, but they can get all that electronically now anyway From DVLA. I forget how it's done, it was back in July.