How Does Car Insurance Work When Flood Causes Damage To Your Vehicle?

Take a look at how car insurance claims are handled in the event of damages to cars caused by flood.

how car insurance claims are handled in the event of damages to cars caused by flood.

The sight of submerged cars and lorries in the streets of Delhi and other North Indian locations has been widely flashed across the media. It is bad news for the vehicle owners and a busy time for motor insurance companies. If you are a car owner in a flood-hit region, you may face a situation where you have to raise a car insurance claim.

  • Flood has wreaked havoc in North India and cars have taken their toll too
  • Insurance companies have a standard approach towards flood damage to cars
  • Informing the police about cars swept away is very important
  • Also, inform the insurance company immediately about damages to the car caused by the flood

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Car insurance claim during floods

Damage to the car in the case of a flood and torrential rain can broadly be one of the few probable ways. The car may be swept away by the flood with no chance of recovery. The car may be recovered with significant damage. Or lastly, the car may be damaged but can be repaired.

In the first case, the insurance company treats the car as a total loss and reimburses the car owner as per the Insured Declared Value (IDV) of the car. 
Even when the car is recovered but has sustained significant damage, the extent of damage is assessed. If the cost of getting the vehicle repaired exceeds 75% of the car’s IDV, the insurance company generally pays the IDV value to the car owner.
If the damage is less than 75%, the insurance company will instruct the car owner to go ahead with the repairs and process the claim accordingly.

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Total Loss Considerations

Some of the important points considered by insurance companies in the case of total loss are:

  • The insurer and original equipment manufacturers assess the damage based on the level of submergence of the car
  • Dashboard-level submergence is considered a total loss
  • Floor level submergence can be considered as a total loss in cars whose vital parts are located in the lower levels
  • In the case of an unrecoverable car, the insurance company may ask for a non-traceable certificate from the police department

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As the car owner who has lost the car in the flood, you must file a First Information Report (FIR) with the police. Then you must inform the insurance company about the loss. Depending on whether the police can locate and recover the car, your insurance company will act on it accordingly. Even in the case of any partial damage faced during the floods, you must inform the insurance company immediately. 
As a precaution, avoid parking your car in waterlogged streets and low-lying areas. Avoid cranking up the engine if you are stuck in a waterlogged street. And always seek roadside assistance to get your car towed to safety, to minimise the damage.

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