June 14, 2024

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These Are Some Reasons That Lead to Rejection of Car Insurance Claims

Reasons Why Insurance Companies can Reject your Car Insurance Claims

Car insurance is a compulsory requirement for car owners. It is mandated by the Motor Vehicles Act and non-compliance with the law can attract hefty penalties. But since it is a legal requirement, many car owners often comply by buying one. There are several conditions included in the policy terms which are soon forgotten after its purchase. This fine print often specifies several terms that need to be followed when raising an insurance claim that, otherwise, can lead to a rejection of your application. It is irrespective of whether you have purchased car insurance online or offline.

A rejected claim is a devastating experience, even despite buying a car insurance plan. In addition, it may cause deep financial loss that can often eat into your hard-earned savings, along with hurting your reputation with the insurer for the future. Thus, it is essential to know what conditions affect the claim process. This article mentions some of the reasons that may lead to a rejection of your car insurance claim. Continue reading to find out more.

  1. Modification of your car

A car insurance policy requires you to declare information regarding your vehicle to the insurer. This includes the model and make of the car, the registration details, its color, engine capacity, and the like. Further, any accessories fitted on or modifications made must also be declared. If not, the rejection of the claim may occur as modifications impact the risk that the insurance company otherwise must cover. *

  1. Skipping car insurance renewals 

Like every insurance policy, a car insurance plan is also valid for a specific period of time. At the end of such a period, it needs to be renewed to ensure continuous coverage. Skipping on renewing your car insurance policy on time can lead to no coverage for a brief duration when the policy is not yet renewed. Any insurance claim made during this period is rejected for the reason of having no active insurance plan. *

  1. Driving without an ownership transfer

In the case of pre-owned cars, it is essential for you to immediately transfer ownership to your name. Failure to do so can result in a rejected claim application since the ownership is still in the name of the previous owner. Thus, you must be compliant in such situations where the legal procedures need to be completed. In addition to the ownership transfer, you also need to complete the transfer of the insurance policy to your name within the stipulated duration of 15 days. *

  1. Driving without a valid driving license

A driving license is a mandatory requirement to legally drive a vehicle in the country. In the event the driver does not hold a valid driving license, it can lead to a rejected claim application. Thus, whether it is you or your friend to whom you have lent your car, make sure to have an active and valid driving license. *

  1. Illegal use of vehicle

Insurance claims for vehicles being used for illegal purposes is an offence, and thus, your insurance claim is rejected. Talking on the phone while driving, driving under the influence of alcohol, and using other narcotic substances are all illegal acts and lead to an ultimate rejection of your claim. *

* Standard T&C Apply

When you purchase an insurance plan, make sure to compare it with the different policies offered using a car insurance calculator. This tool helps to compare not just based on the premiums, but also its features. Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms and conditions, please read sales brochure/policy wording carefully before concluding a sale.