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CAR INSURANCE

Steps You Should Take to Avoid Car Insurance Claim Rejection in India

Janhavi Shinde Janhavi Shinde 22 September 2017
4.7 (6 votes)

You invest pots of money for buying your dream machine. But, what guarantee do you have that your car insurance claim will be approved after an accident? Read on to know more!

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You know you are in deep trouble when you see your car damaged brutally when a biker speeds up to cut in from the other side of the road.

Though bodily injuries were zero, you feel broken looking at the state of your car.

The car that has become a second home for you, post investing your hard-earned money is damaged.

You have 100% trust in the car insurance company for a hassle-free car insurance claim settlement.

But, WAIT!

Do you know there are chances that your insurance company may not honor your car insurance claim?

WHY?

Let's find out some circumstances where it is quite possible for your claim to get rejected and how you can avoid them.

Step 1: Lack of knowledge…That is the problem!

Well, it is rightly said that people are destroyed due to lack of knowledge.

Many people buy car insurance policy just for the heck of it. But, when it comes to filing a claim, they actually go through a lot of trouble due to lack of knowledge.

The terms and conditions of the car insurance policy are systematically mentioned in the policy document. Sadly, very few bother to even have a look at it.

Policy documents are made to relieve the car insurance companies from a financial as well as legal liability that may arise post signing a contract with you.

Missing the asterisks on the policy wordings will put you in a total mess.

Solution: It is recommended to thoroughly read the policy terms and conditions and carefully scrutinize it to avoid car insurance claim rejections.

Seek advice from your insurance company or the online broker (in case you buy one from them), when in doubt.

Step 2: Stop dilly-dallying –Pay your premiums on time!

Yes, you got it right! STOP being lazy and pay your car insurance premiums on time.

Procrastinating will only lead to lapsed car insurance policies.

You are no longer covered under a car insurance policy once it is lapsed. The premiums you paid so far will be proved unusable.

Any insurance company will not entertain car insurance claims when it comes to a lapsed insurance policy.

Besides, you may also lose over the No claim bonus if you do not renew your car insurance policy within 90 days from its expiry.

If your car meets with an accident during the lapsed policy period, you will have to shell out your hard-earned bucks to get it repaired.

Besides, any bodily injuries to the third party will also be borne by you.

Solution: Keep a keen watch on your car insurance policy expiry date. Renew it on time to avoid unnecessary hassles.

Do not pose a risk to you, your car and the third party's life by taking the law in your hands!

Step 3: Don't act over smart – First inform your insurer

Okay, so you think you did a wise thing by getting your car repairs done first without informing the insurer?

NO, not really!

People usually get their car damages repaired thinking they can later get the same reimbursed from the car insurance company. WRONG!

It is your duty to first inform the car insurance company about the incident. The surveyors from the insurer's office will inspect the car.

A thorough analysis will be done by the surveyors for the cost of damage and an estimate would be then provided to you.

Your insurance company has all the rights to reject your car insurance claim in case you get the repairs done first and then inform them.

One of the many reasons of the claim rejection can be the inability to trace the accident spot and the cost of damage.

Not to forget, inform the car insurance company within the prescribed time frame. This definitely varies from one insurer to another!

Solution: First thing first, inform your car insurance company about the accident. DO NOT get the repairs done on your own.

This can definitely lead to a car insurance claim rejection.

Step 4: From bars to behind bars – Watch out!

Well, you really need guts to drive after pushing those pegs down your system.

But, WAIT!

If you feel you are going to get a 'bravery award' for driving on the Indian roads under the influence of alcohol or narcotics, you are WRONG!

There are so many even today, who intentionally take the law in their own hands. But, why?

Insurance companies will straight forwardly reject your claim if you drink and drive. Forget about the car insurance claim getting rejected, be ready to go behind the bars!

Besides, due to the stringent laws, paying a penalty of Rs.10,000 (which was earlier Rs.2,000) and imprisonment of 6 months to 4 years will be applicable. Also, your license will be revoked and you may have to appear before the court.

Drunk and drive is one of the most common exclusions under a car insurance policy.

Solution: Avoid driving under the influence of alcohol or drugs. Ensure you drive safely and be a responsible citizen. Don't invite troubles by violating laws.

Trust us, if you adhere to the rules, you can definitely have a smooth and hassle-free car insurance claim settlement, when need be.

Step 5: Forgot to transfer the car ownership in the insurance policy?

Well, there can be two possibilities.

You can either forget to transfer the car's ownership under your name in the insurance policy. Or you can intentionally act lazy to get it done.

Reasons can be either of them, but the loss is YOUR'S.

It is your responsibility to transfer the insurance policy in the new owner's name after buying the car.

The car insurance policy will be considered invalid in case in case any claims arise. Why invite trouble when you can get the documentation easily by informing your insurer on time?

Your insurance company will not honor any claim in case the car insurance is not transferred on time.

Solution: Whether brand new or second-hand car, make sure you transfer the car insurance policy in your name at the earliest.

Don't wait for an incident to happen. Claims in either ways would be rejected. Ignorance will only cause hassles.

Step 6: Installed a CNG/LPG kit - Smart – Kept your insurer in loop?

You did a smart thing by installing a CNG/LPG kit in your car.

Obviously, you increase the life span of your car's engine since it consumes less gas by the CNG/LPG kit. Besides, it's economical too.

But, did you inform your car insurance company or the online insurance broker about your wise thing?

If NO, you had it!

God forbid if your car meets with an accident, your insurance company will upfront reject the car insurance claim.

Your negligence will cost you and you will have to bear the brunt.

Solution: Declare to your insurance company about installing a CNG/LPG kit. And make sure you update the same in the RC book (Registration Certificate) as well. If not, be ready for car insurance claim rejection.

Step 7: A private car but being used to make money?

Like really?

You buy the car for your private use.

But, suddenly thought of renting it out for an OLA or an UBER? Or for that sake, for any commercial use?

Be ready for car insurance claim rejection if you use your private car for commercial purposes.

You can certainly go the right way by opting for a passenger carrying car insurance or goods carrying car insurance if you wish to use your car for commercial use.

Solution: Get an appropriate car insurance policy in case you want to make money from your car. Using your private car for commercial purposes is definitely NOT the solution.

Step 8: Do not have a valid driving license?

Driving safely is one thing.

But, driving safely without a valid license is an offence!

Your car insurance claim will not be honored, in case your car meets with an accident if you or your friend were driving the car without a valid license.

Why create unwanted hassles when you can avoid such things in the first place?

Solution: Do not drive unless you have a valid driving license. Besides, do not allow anyone else to drive your car who doesn't possess a valid license.

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Thus, it is in the best of interests to avoid falling into this self-made trap. Follow the above-mentioned steps to avoid car insurance claim rejection in India.

You buy a car insurance policy for it to help you file for hassle-free claims when the need arises. Why unnecessary break the rules and fall prey to claim rejections?

While you may still need advice, Coverfox.com is always there to help you today and always!

Recommended Read: How to Overcome Car Insurance Claim Rejection?

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4.7 (6 votes)
Janhavi Shinde
Written by Janhavi Shinde
Right from being a Flight Attendant to a Banker and now to a Content Writer, she has tasted success in all the fields. The kinda girl who loves pets and knows how to manage difficult people and events.