- Date : 05/06/2020
- Read: 4 mins
To ensure that the decision to get yourself a car insurance policy was not in vain, it’s important you do everything you can to ensure your insurance claim is not rejected
Meta: Car insurance is not just a regulatory requirement, but a great help in mitigating the financial risk in the event of a mishap. There are many reasons why your car insurance may get rejected, such as – not adhering to the terms of coverage, making unauthorised modifications to the vehicle, getting the car fixed before the insurance appraiser has seen the vehicle or driving under the influence of alcohol or drugs. Understanding and following the insurance protocols will minimise the chances of rejection.
For most Indians, owning a car is a symbol of prestige and an indication that they’re doing well for themselves. We think of it as an investment, and spend a significant amount of time on the purchase decision, and because we believe in safeguarding our assets (and also because the government has made it mandatory!), we insure our vehicles. But sometimes, when a mishap occurs, and we need to rely on this insurance, our claim gets rejected.
Related: Comprehensive guide to purchasing a car this festive season
Though only third party car insurance is mandatory by Indian Law, car owners usually opt for a comprehensive car insurance policy since it provides protection against damage inflicted on your own car as well as safeguarding the well-being of the other party.
After taking this precautionary measure, it can get frustrating to not only have your car damaged, but also have your car insurance claims for the same rejected.
Let’s look at some reasons why this may happen and what to do if insurance claim is rejected.
1. Getting car repaired before filing a claim
This is one of the most common mistakes made – hurrying to get your car repaired before the insurer has had a chance to assess damage. It is important to always intimate your insurance company first so that an authorised personnel from their end can understand what happened, inspect your vehicle, and comprehend the extent of damage. In many cases, they can also help you get the best deal for the repairs.
Also, it is important to file your claim within the specified time period as per your policy, failing which the claim can get rejected and it will be rewarded as No Claim Bonus ranging up to 50%.
2. Using it for an alternate purpose
While taking an insurance policy on your car, you are required to state the purpose for which the vehicle will be used. As per car insurance terms, if you have stated that it is for personal use, but while investigating, the insurer finds that it was used for commercial purposes, the claim will most likely be rejected. It is always better to be truthful right at the very start. Also, if there is a change in the usage purpose of your car, you should contact your insurer immediately, and intimate them about the same.
3. Undeclared modifications to car
Your insurer needs to be kept updated about any modifications you, or the previous owner of the car- in case it’s a second-hand vehicle- may have made. Be it cosmetic or engine-related, all changes made to the car that alter it from its factory standard must be declared, else, your claim can get rejected. Even CNG/LPG kits, roof racks and paintwork are considered modifications, and hence, it is important to be aware of any such aspects by reading through the car insurance terms and conditions, and apprise the insurance company of any changes.
4. No transfer of ownership
Insurance is taken in the driver’s name and not in the car’s name, and hence, in case you are buying a used or second-hand car, it is essential that you complete the transfer formalities at the time of purchase. Failure to do so can lead to any future claim getting rejected since the policy will be considered invalid.
5. Driver-related issues
The person driving the car at the time of the accident will be investigated as well, and should pass certain criteria, such as the possession of a valid driving license, and not being under the influence of alcohol or drugs. Not satisfying these conditions will cause the claim to be rejected.
In addition, there are other reasons, such as continued use of the car once it has been damaged, parking in a no-parking zone, car being occupied by people exceeding the legal number of passengers allowed, missing insurance renewal dates, purposely breaking your car etc. that can lead to a filed insurance claim being rejected.
While you have taken the wise decision to take an insurance policy on your car, it is also important for you to ensure that you do not make any of the above mistakes. Be sure to read and understand all related car insurance terms and conditions before you purchase a policy. After all, what is the use of a sound insurance policy, if damages cannot be claimed!
Meta: Car insurance is not just a regulatory requirement, but a great help in mitigating the financial risk in the event of a mishap. There are many reasons why your car insurance may get rejected, such as – not adhering to the terms of coverage, making unauthorised modifications to the vehicle, getting the car fixed before the insurance appraiser has seen the vehicle or driving under the influence of alcohol or drugs. Understanding and following the insurance protocols will minimise the chances of rejection.
For most Indians, owning a car is a symbol of prestige and an indication that they’re doing well for themselves. We think of it as an investment, and spend a significant amount of time on the purchase decision, and because we believe in safeguarding our assets (and also because the government has made it mandatory!), we insure our vehicles. But sometimes, when a mishap occurs, and we need to rely on this insurance, our claim gets rejected.
Related: Comprehensive guide to purchasing a car this festive season
Though only third party car insurance is mandatory by Indian Law, car owners usually opt for a comprehensive car insurance policy since it provides protection against damage inflicted on your own car as well as safeguarding the well-being of the other party.
After taking this precautionary measure, it can get frustrating to not only have your car damaged, but also have your car insurance claims for the same rejected.
Let’s look at some reasons why this may happen and what to do if insurance claim is rejected.
1. Getting car repaired before filing a claim
This is one of the most common mistakes made – hurrying to get your car repaired before the insurer has had a chance to assess damage. It is important to always intimate your insurance company first so that an authorised personnel from their end can understand what happened, inspect your vehicle, and comprehend the extent of damage. In many cases, they can also help you get the best deal for the repairs.
Also, it is important to file your claim within the specified time period as per your policy, failing which the claim can get rejected and it will be rewarded as No Claim Bonus ranging up to 50%.
2. Using it for an alternate purpose
While taking an insurance policy on your car, you are required to state the purpose for which the vehicle will be used. As per car insurance terms, if you have stated that it is for personal use, but while investigating, the insurer finds that it was used for commercial purposes, the claim will most likely be rejected. It is always better to be truthful right at the very start. Also, if there is a change in the usage purpose of your car, you should contact your insurer immediately, and intimate them about the same.
3. Undeclared modifications to car
Your insurer needs to be kept updated about any modifications you, or the previous owner of the car- in case it’s a second-hand vehicle- may have made. Be it cosmetic or engine-related, all changes made to the car that alter it from its factory standard must be declared, else, your claim can get rejected. Even CNG/LPG kits, roof racks and paintwork are considered modifications, and hence, it is important to be aware of any such aspects by reading through the car insurance terms and conditions, and apprise the insurance company of any changes.
4. No transfer of ownership
Insurance is taken in the driver’s name and not in the car’s name, and hence, in case you are buying a used or second-hand car, it is essential that you complete the transfer formalities at the time of purchase. Failure to do so can lead to any future claim getting rejected since the policy will be considered invalid.
5. Driver-related issues
The person driving the car at the time of the accident will be investigated as well, and should pass certain criteria, such as the possession of a valid driving license, and not being under the influence of alcohol or drugs. Not satisfying these conditions will cause the claim to be rejected.
In addition, there are other reasons, such as continued use of the car once it has been damaged, parking in a no-parking zone, car being occupied by people exceeding the legal number of passengers allowed, missing insurance renewal dates, purposely breaking your car etc. that can lead to a filed insurance claim being rejected.
While you have taken the wise decision to take an insurance policy on your car, it is also important for you to ensure that you do not make any of the above mistakes. Be sure to read and understand all related car insurance terms and conditions before you purchase a policy. After all, what is the use of a sound insurance policy, if damages cannot be claimed!
