10 reasons why car insurance claims get rejected

Posted on: Feb 19, 2019 | 3 mins | Written by: HDFC ERGO Team

10 reasons why car insurance claims get rejected

Reasons for Car Insurance Claim Rejection

Have you sent a Car insurance claim to your insurance company that was recently rejected, but you have no idea why? There are terms and conditions that you must meet for your car insurance claim to be passed by the insurance company. Depending on the degree of damage and what is covered in your insurance policy, your insurance company passes the claim. Even then, there may be several circumstances under which the insurance company may reject your car insurance claim. Let us understand the top ten reasons why insurance companies refuse to pass your claim.

None of us like rejections be it job rejection or VISA denial, it just puts us down feeling demotivated and discouraged. Similarly unfortunately if your car insurance premium gets rejected it might bring in mental stress and let you down. Hence it's important to know how and why your car insurance claim rejected. Before that let's understand what is the car insurance claim procedure? And how it works.

CAR INSURANCE CLAIM can be made in two ways viz, Cashless & Reimbursement. For cashless claims you need get your vehicle inspected and repaired at a network garage without making the job payment except the consumables cost. However, in case of reimbursement claim you have to make the initial payment at the non network garage. You can then submit the job sheet and invoices with your insurer to get the claim settled.

Major reasons for rejection of car insurance claims

Many of us are unaware about why car insurance claim rejected? Ever wondered what could lead to car insurance claim rejection? Well, CAR INSURANCE CLAIM rejection can take place due to several reasons and faults.

Non accidental loss of vehicle - In case your vehicle is damaged without facing an accidental scenario or natural calamity your claim might get rejected, as insurance companies settle claims or offer cashless benefits only in case of circumstantial damage and no claims for repair or wear/tear will be entertained.

For your car insurance claim to be valid, your tenure needs to be active at the time the accident occurred. Moreover, it is also important that the type of damage falls under your insurance policy. Here are the top ten reasons why most insurance companies reject your car insurance claim -

Car accidental claims due to drunk and driving

Drunk driving is a major offence. The government does not permit driving your vehicle in case you have consumed alcohol. In this situation, if you have met with an accident and applied for an insurance claim, your insurance company will most likely refuse or reject the claim.

Using private cars for commercial purposes

To use your car for commercial purposes, it is important to register the same in the RTO office in India. It is essential to have the complete documentation for the same. Based on this, your insurance policy must also be updated. However, if you have used your private cars for commercial purposes, your insurance company can reject your car insurance claim. Thus, check out your car insurance policy before applying for the claim.

Damage due to self negligence

Car insurance claims can only be applied for accidents or unfortunate events. It cannot be used for cases where the damage is caused due to self-negligence. While driving, every individual needs to be alert and take the necessary precautions. This can help prevent injury and save lives.

Driving in an inebriated state

Attention while driving is essential. This can help in reducing the number of accidents. However, if you are driving uncompromised, such as when you have consumed drugs or are drunk, your insurance company has the right to reject your car insurance claim.

Untimely payment of insurance premium

To keep your car insurance active, making timely payments as per your insurance premium is important. Depending on your selected plan, this can be monthly, quarterly or annually. When you pay your car insurance timely, it talks about your credibility. If you have not paid your insurance premium on time, your car insurance policy may get cancelled or rejected. In this case, the car insurance company may reject your claim.

Providing misleading details to the insurance company

While applying for a car insurance claim, you are asked to provide details about the accident or event, such as the date, time, venue, type of accident, who was driving the vehicle, etc. If you make errors or fabricate this information, the insurance company has the exclusive right to reject your car insurance claim because you have provided misleading details.

Modification of your car before insurance renewal

As a rule, if you meet with an accident and are applying for a car insurance claim, an agent from the insurance company comes to visit and physically inspect your car. If, in this case, you make any modifications to the vehicle to support your claim or otherwise, the car insurance company can reject your claim.

Disobeying the policy normal and regulations

When you take up a car insurance policy, you enter into a negotiation or contract with the car insurance company. As per this agreement, you must abide by various rules and regulations. For instance, depending on your insurance company, you must inform them about the accident within a fixed time from when it occurred. Only in that case you shall be liable to get your claim passed. However, if you fail to meet the policies and regulations, the car insurance company may reject your claim.

Insurance claims which arise out of consequential losses

Car insurance claims, which have occurred due to consequential losses, are often rejected by the car insurance company. For instance, if there is some technical error with your vehicle's engine, you must get it repaired. The car insurance company may not pass your claim if you enter into an accident due to negligence.

Car insurance policy lapse

Lastly, the most common reason companies reject your car insurance claim is when your car insurance policy has lapsed. Thus, it is important to check on your policy and update it on time timely.

Conclusion

Apart from this, several companies also reject car insurance claims on their grounds, depending on what's included in this policy and what's excluded. Thus, selecting a company that offers you the most benefits and is transparent is important. Check out HDFC Ergo, a company that offers car insurance at affordable prices and has a higher claim passing percentage.

Disclaimer: The above information is for illustrative purpose only.For more details, please refer to policy wordings and prospectus before concluding the sales.

This blogs has been written by

Mr. Mukesh Kumar recommends "getting your TWO WHEELER INSURED from HDFC ERGO, a brand serving more than 1.5 crore+ customers. With overnight repair services and more than 7600+ network garages, you can be assured of help in event of any damage to your vehicle".

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