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The first step after buying a new car is to buy a comprehensive Car Insurance policy for ensuring financial protection during a mishap, damage or theft. Besides having a car insurance policy, you should also be well versed with certain basic protocols to be followed to ensure your insurance related claims are not denied by your insurer.
Here are some of the common reasons why your car insurance claim could be denied:
Negligence Due To Drunken Driving
Driving a vehicle in an inebriated condition amounts to negligence as the probability of mishaps are high. For insurance companies the chances of accidents are high in such condition due to less control over the vehicle. A closer look at your car insurance policy document will also reveal that drunken driving is totally outside the ambit of any insurance coverage. So while you may believe you can handle driving after drinking, it is best avoided for your own safety as well as the safety of others on the road.
Not Producing Valid Driving License
As per the law, every driver operating a vehicle on Indian roads should possess a valid driving license. You cannot claim insurance in the absence of a valid license. This is also same for vehicle owners carrying expired license on the day the accident took place.
Improper Handling Of Vehicle
Improper handling of your vehicle can be another reason why the car insurer can deny your claim. For example, you may have a car insurance along with an engine protection add on cover but if you are found to be deliberately turning on the ignition in flooded waters, it will be considered as a deliberate attempt to damage car’s engine. So always handle your vehicle with care and as per the norms of the car insurance policy to avoid any such claim denials.
Insurance In A Different Name
If you bought a second hand car, you must ensure that the car insurance is also transferred in your name from the previous owner to claim insurance during the times of need. Always ensure transfer of car insurance in your name as the new owner, the same way it is done with the registration certificate (RC) of the car. To avoid the chance of a claim refusal, do ensure that the name in the car insurance policy matches with that in the RC.
Commercial Use Of Personal Vehicle
In today’s world of radio cabs, many car owners are using their personal cars for commercial purposes. So if you are one of those using a personal vehicle for any commercial gains, not only are such activities illegal, it can also mean denial of any insurance or theft claims.
Delay In Informing The Insurer
Be it a theft or accident claim, one of the first things you as a car owner must do is file an FIR and inform the insurance company about the same. Delay in informing the insurer can be used against you as a genuine reason for claim denial. For example, for an accident claim, care must be exercised to not move your vehicle from the accident spot unless approved by police and car insurer. Most car insurance companies have a 24/7 helpline so getting in touch with the insurer is now seamless and easy and must be followed without fail.
Expired Car Insurance Policy
Your car insurance policy must be renewed before the lapse date to ensure claims are not rejected. Any claims you may seek when the policy is lapsed may not be acknowledged by the car insurance company. Always renew your car insurance plan 15-20 days before its expiry period to allow for seamless cover.
Car insurance claims are easy to seek but also come with a high denial rate. It is thus important to know about common mistakes to avoid denials for insurance claim.