Car insurance is a crucial cover that protects you and your car against financial losses that may arise out of unanticipated mishaps. Even if you are the most careful driver, there’s a chance you are a victim of natural or man-made calamity. It is natural to rely on your insurance during this situation. This is why car insurance rejections are terrible.
Car insurance claim rejection can mess up your finances and leave you with stress and worries. It is possible to avoid getting your claim rejected. But for that, you first need to know the circumstances under which your claim can be rejected. We have discussed this and more in this blog.
5 Reasons for Car Insurance Claim Rejection
There are many reasons why your car insurance claim can be rejected. Some of them can be:
Making a fraudulent claim is a sure-shot way of not only getting your claim rejected but also getting your policy canceled. It is next to impossible to lie to insurance companies as they send a surveyor to inspect whether your claim is genuine.
The surveyor verifies everything and diligently compares your car and its damage to the one you have filed the claim. The claim will be rejected if the surveyor finds a discrepancy in your narrative and the evidence.
Similarly, if you provided false information while purchasing your policy and your insurer discovers it now, they will reject your claim and might even cancel your policy. So, make only genuine claims.
Driving under influence:
Drinking and driving is a legal offense. Similarly, driving under the influence of drugs is also illegal. It can lead you to get fined and even jailed. Under the circumstances when an accident occurs while you were drunk, the insurance company is not liable to pay for any losses incurred to the car and any medical expenses. Your claim will be rejected, and you will have to pay everything out of your pocket.
Violating traffic rules or driving without a driver’s license:
If you get into an accident because of violating the traffic rules, such as driving during a red light, the insurance company has full rights to reject your claim. The insurance policy covers man-made calamities, such as theft and accidents, and natural calamities, but not accidents that happen because of negligence.
Similarly, if you are found driving without a driver’s license during the time of the accident, you will be held responsible for the accident and the insurance company can reject the claim.
Delay in intimating insurance companies:
This is perhaps the most innocent and most common reason for claim rejection. If you get into an accident and send your car for repairs without informing your insurance provider, there is a chance for your claim to get rejected later. This is because your insurance will have a hard time verifying and assessing the damage for claim approval.
Another reason is if you don’t inform your insurance provider on time. The period is typically mentioned in policy documents. If you take more than that time to alert your insurance provider, they can reject your claim.
The only way to avoid this situation is to inform your insurance provider before you give your car for repairs so that they can assess the damage and verify your claim.
It is entirely possible and fair for you to make modifications to your car during a policy year. However, it is also integral to inform your insurer of these modifications and additions before renewing your policy. The insurer will inspect your car after receiving the news about these additions and only then extend the policy to cover them. This might result in an increase in the premium amount as well, which can be calculated using a car insurance calculator. This is why if you don’t inform your insurer about these changes, they can reject your claim instantly on the grounds of uninformed modifications.
These are not the only circumstances under which your claim can be rejected. Other reasons include driving outside the area covered under the policy, using a private car for commercial purposes, breaching policy conditions, and not paying a premium for the policy on time. Your claim will also be rejected if your policy has already lapsed.
Things to Keep in Mind to Prevent Your Claim from Getting Rejected
Insurance companies carefully inspect all the claim requests they receive. Even the slightest discrepancy or sign of fraud can lead to claim rejection. To avoid this, keep these things in mind while making a claim.
- Inform your insurance company on time. Read the policy documents carefully for the timeframe mentioned. Although the right practice is to inform your company as soon as possible.
- In most cases, such as theft and major accidents, you need to file an FIR to claim your insurance. So file the FIR soon after the incident.
- Submit all the documents immediately to your insurance provider. Make sure the documents are authentic.
- Click pictures of your and the other party’s car immediately after an accident and keep them as proof for the insurer. While the insurer will send their surveyor to survey the damages, it is best to keep proof for yourself.
- Don’t try to use your car after an accident. If you do so and consequential damage happens, your insurance company can reject the claim on those grounds.
- Don’t repair your car without involving your insurer. Let the insurer inspect the car and assess the damage. Send the car for repair only after you receive their okay.
- Carefully read the terms and conditions of your policy. In case you claim something that was excluded from your policy terms, your claim will be rejected.
Car insurance is a safety net and financial protection against possible losses due to man-made and natural calamities. A claim is approved only after the car insurance provider verifies the claim and inspects the car. There are situations when your claim might be rejected because of valid reasons. This can be avoided by following the tips we have mentioned above and making only genuine claims.
Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales