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Zero Depreciation Car Insurance Explained

Depreciation in motor insurance​​ often refers to the loss in value of an asset over time due to factors such as age, wear and tear, and obsolescence. Vehicles, in general, are depreciating assets. For example, a new car will cost more than an older one. Similarly, there is a certain depreciation associated with all the materials the car is made up of such as glass, plastic, metal etc. Each of the materials or parts have a different rate of depreciation.

 

In the event of an accident, if your car is damaged, you may not be able to recover the entire expense incurred on the parts replacement. The general insurance​ company only pays for the replaced parts after deducting the depreciation amount. The insured person has to pay for the difference between the market value of the new part and the depreciated part of the car.

 

It is a good idea to avail zero depreciation for car insurance. With the help of it, you get maximum reimbursement during the time of claim and get the most out of your car insurance policy.

 

What is Zero Depreciation Car Insurance Cover?

 

A car i​nsurance with zero depreciation cover helps protect your car against all physical damages caused to the car without factoring in the element of depreciation. Although a standard motor insurance policy​ covers you against losses arising in case your car is damaged or stolen when you file for a claim settlement, the compensation is received after a standard deduction of depreciation.

 

On the other hand, a car insurance​ with zero depreciation cover can fetch you the entire compensation amount. A zero depreciation add-on cover can be availed for brand new vehicles and also can be opted for at the time of policy renewal.

 

In a zero depreciation​ car insurance​ policy, the entire claim amount is paid by the Car Insurance Company without considering the depreciation on the value of the car. Obviously, you have to pay slightly more in terms of your premium. However, this add-on feature is highly recommended to everyone considering the fact that it eliminates the possibility of any out-of-pocket expense from the owner.

 

Benefits Of A Zero Depreciation Car Insurance Cover​

 

• Helps curb out-of-pocket expenses since depreciation cost is not taken into account while filing for a claim settlement

 

• Most of your claims regarding the insured parts are settled without taking the depreciation amount into consideration.

 

• It adds more value to the basic automobile insurance coverage and makes your investment almost nil

 

With this cover, you can be assured of a complete peace of mind. Also, with all major insurers offering this cover, you can save yourself a lot of hassle by purchasing a nil-depreciation cover by paying a little extra premium.

 

Zero Depreciation Cover Vs Normal Car Cover

 

Let’s quickly look at how a zero depreciation cover varies from a normal car insurance cover:

 

Value consideration at the time of Claim Settlement: Depreciation does not affect the claim settlement and the full compensation is given to the insured in case of zero depreciation cover. On the other hand, in case of a normal car insurance cover, the claim amount is received after a standard deduction of depreciation.

 

Premium: The premiums to be paid for a zero depreciation cover are higher than those for a normal car insurance cover.

 

Repairing Costs: The repairing costs of fiber, glass, rubber, and plastic parts are borne by the insurer in case of zero depreciation cover whereas, in case of a normal car insurance cover, these repairing costs have to be borne by the insured.

 

Age of the car: A zero depreciation cover is meant for new cars whereas a normal car insurance cover can be taken for cars older than 3 years.

 

Factors to Consider before Opting for Zero Depreciation Cover

 

The following are a few important points to consider while opting for car insurance with zero depreciation policy:

 

• Consider the age of your car. The car insurance zero depreciation policy is applicable to cars under the age limit of 3 years. So in other words, only new cars are eligible for 0 depreciation car insurance.

 

• As compared to a regular car insurance policy, zero depreciation car insurance will be slightly more expensive in terms of premium. It is not advisable to pay high premiums for cars older than 3 years. Although, if you own a luxury car or live in a high-risk area, you should consider opting for zero depreciation cover add-on. A zero depreciation policy premium depends on 3 main factors:

 

a) Age of the car

 

b) Model of the car

 

c) Your location

 

• You can make only a certain number of claims under the 0 depreciation car insurance. This is to limit the customers from making claims about every small dent in their car.

 

Remember that in case you make a claim, with a basic car insurance policy, the insurer only reimburses the depreciated value of the car parts replaced. As per the Insurance Regulatory and Development Authority of India (IRDA), the following rate of depreciation for the car parts has been defined:

 

• On rubber, nylon and plastic parts, and batteries – 50% depreciation be deducted,

 

• On fiberglass components – 30% depreciation be deducted

 

• On wooden parts – depreciation be deducted as per the age of car (such as 5% in the first year, 10% in the second year, and so on)

 

Who Should Buy Zero Depreciation Cover?

 

In order to protect your brand new car from any unforeseen events, it is advisable to opt for a zero depreciation cover. Buying a zero depreciation car insurance in India can also prove to be beneficial to:

 

• People with new cars

 

• People with luxury cars

 

• New / Inexperienced drivers

 

• People living in accident-prone areas

 

• If you worry about small bumps and dents

 

• If you have a car with expensive spare parts

 

It is a general belief that zero depreciation car insurance policy is apt for new or inexperienced car drivers as they are more prone to get the car damaged. However, this cannot be considered as a rule of thumb because there have been numerous cases where the most experienced drivers were caught in unfortunate events due to the fault of other drivers.

 

Source: Reliancegeneral

Useful Car Insurance Add-on covers that can boost protection for your vehicle

Car insurance is considered an effective tool to financially protect your car from risks such as road accidents, vehicle theft or third-party liabilities that may occur while driving. While having a valid third-party (TP) car insurance is mandatory for all vehicles plying on Indian roads, few owners are aware that in a standard comprehensive car insurance only an own damage (OD) cover is payable. Other losses like engine damage due to floods or depreciation on value of parts replaced are not covered in own damage cover, which can significantly increase the owner’s liability in many scenarios. Let us have a look at a few indispensable car insurance add-on covers that are recommended to enhance the overall financial protection for your car and to ensure you enjoy a stress-free ownership experience.

 

Nil Depreciation Cover

As your car ages, its value depreciates with time, and you may not be able to recover the full cost of replacement of car parts. At the time of insurance claim, this results in partial recovery of the cost of parts replaced and can lead to a substantial liability in case of medium to major damages. A Nil Depreciation add-on cover protects you from this depreciation and expands coverage of repair cost to the fullest extent possible.

 

Engine Protection Cover

While modern cars are considered to be highly reliable, there are susceptible to hydrostatic lock related damages when the car is driven through flooded areas which can lead to huge expenses. Choosing an engine protection add-on cover assists in recovering the cost of repairs to your car’s engine in such situations and also includes scenarios where engine damage arises out of leakage of lubricant oil in case of underbody vehicle damage.

 

Return to Invoice

If your is stolen or damaged beyond repair, it can cause a lot of mental stress and burn a big hole in the pocket. A Return to Invoice cover (RTI) add-on cover provides full reimbursement of the final invoice value of the car in such situations.

In addition to the above add-ons, other important covers include EMI protection, Consumable cover, No Claim Bonus Protection cover, Tyre, Key & Rim protection cover. It is advisable to compare car insurance policies on more than cost grounds and opt for these add-on covers as per car’s requirement and protect yourself from myriad expenses that can occur in different driving conditions.

 

Source: Reliancegeneral

What is Zero Depreciation Car Insurance Cover?

Depreciation in motor insurance often refers to the loss in value of an asset over time due to factors such as age, wear and tear, and obsolescence. Vehicles, in general, are depreciating assets. For example, a new car will cost more than an older one. Similarly, there is a certain depreciation associated with all the materials the car is made up of such as glass, plastic, metal etc. Each of the materials or parts have a different rate of depreciation.


In the event of an accident, if your car is damaged, you may not be able to recover the entire expense incurred on the parts replacement. The general insurance company only pays for the replaced parts after deducting the depreciation amount. The insured person has to pay for the difference between the market value of the new part and the depreciated part of the car.


It is a good idea to avail zero depreciation for car insurance. With the help of it, you get maximum reimbursement during the time of claim and get the most out of your car insurance policy.


What is Zero Depreciation Car Insurance Cover?


A car insurance with zero depreciation cover helps protect your car against all physical damages caused to the car without factoring in the element of depreciation. Although a standard motor insurance policy covers you against losses arising in case your car is damaged or stolen when you file for a claim settlement, the compensation is received after a standard deduction of depreciation.


On the other hand, a car insurance with zero depreciation cover can fetch you the entire compensation amount.  A zero depreciation add-on cover can be availed for brand new vehicles and also can be opted for at the time of policy renewal.


In a zero depreciation car insurance policy, the entire claim amount is paid by the Car Insurance Company without considering the depreciation on the value of the car. Obviously, you have to pay slightly more in terms of your premium. However, this add-on feature is highly recommended to everyone considering the fact that it eliminates the possibility of any out-of-pocket expense from the owner.


Benefits Of A Zero Depreciation Car Insurance Cover


• Helps curb out-of-pocket expenses since depreciation cost is not taken into account while filing for a claim settlement

• Most of your claims regarding the insured parts are settled without taking the depreciation amount into consideration.

• It adds more value to the basic automobile insurance coverage and makes your investment almost nil


With this cover, you can be assured of a complete peace of mind. Also, with all major insurers offering this cover, you can save yourself a lot of hassle by purchasing a nil-depreciation cover by paying a little extra premium.


Zero Depreciation Cover Vs Normal Car Cover


Let’s quickly look at how a zero depreciation cover varies from a normal car insurance cover:


• Value consideration at the time of Claim Settlement: Depreciation does not affect the claim settlement and the full compensation is given to the insured in case of zero depreciation cover. On the other hand, in case of a normal car insurance cover, the claim amount is received after a standard deduction of depreciation.


• Premium: The premiums to be paid for a zero depreciation cover are higher than those for a normal car insurance cover.


• Repairing Costs: The repairing costs of fiber, glass, rubber, and plastic parts are borne by the insurer in case of zero depreciation cover whereas, in case of a normal car insurance cover, these repairing costs have to be borne by the insured.


• Age of the car: A zero depreciation cover is meant for new cars whereas a normal car insurance cover can be taken for cars older than 3 years.


Factors to Consider before Opting for Zero Depreciation Cover


The following are a few important points to consider while opting for car insurance with zero depreciation policy:


• Consider the age of your car. The car insurance zero depreciation policy is applicable to cars under the age limit of 3 years. So in other words, only new cars are eligible for 0 depreciation car insurance.


• As compared to a regular car insurance policy, zero depreciation car insurance will be slightly more expensive in terms of premium. It is not advisable to pay high premiums for cars older than 3 years. 


Although, if you own a luxury car or live in a high-risk area, you should consider opting for zero depreciation cover add-on.


A zero depreciation policy premium depends on 3 main factors:


a) Age of the car

b) Model of the car

c) Your location


• You can make only a certain number of claims under the 0 depreciation car insurance. This is to limit the customers from making claims about every small dent in their car.


Remember that in case you make a claim, with a basic car insurance policy, the insurer only reimburses the depreciated value of the car parts replaced. As per the Insurance Regulatory and Development Authority of India (IRDA), the following rate of depreciation for the car parts has been defined:


• On rubber, nylon and plastic parts, and batteries – 50% depreciation be deducted,

• On fiberglass components – 30% depreciation be deducted

• On wooden parts – depreciation be deducted as per the age of car (such as 5% in the first year, 10% in the second year, and so on)


Who Should Buy Zero Depreciation Cover?


In order to protect your brand new car from any unforeseen events, it is advisable to opt for a zero depreciation cover.  Buying a zero depreciation car insurance in India can also prove to be beneficial to:


• People with new cars

• People with luxury cars

• New / Inexperienced drivers

• People living in accident-prone areas

• If you worry about small bumps and dents

• If you have a car with expensive spare parts


It is a general belief that zero depreciation car insurance policy is apt for new or inexperienced car drivers as they are more prone to get the car damaged. However, this cannot be considered as a rule of thumb because there have been numerous cases where the most experienced drivers were caught in unfortunate events due to the fault of other drivers.


Source: Reliancegeneral

Everything you ever wanted to know about Package Motor Insurance

  • A package policy is an insurance cover which in addition to covering third party liabilities, covers the insured against damages caused to their own vehicle such as accidental damage, fire, vandalism, acts of god, natural calamities, etc. A package cover comes at a higher premium compared to a plain third-party (TP) cover simply because it offers wider protection.
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  • A basic third-party insurance protects the vehicle owner against any liability that could arise when a third-party gets injured or dies in case of an accident. Third party insurance is mandatory by law in order to drive on Indian roads, and hence, most people buy it to adhere to regulatory requirements. However, a package motor insurance covers damages to one’s own vehicle in addition to third-party damages and liabilities.
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  • Factors Affecting Motor Insurance Premiums
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  • A host of factors influence the premium of package insurance covers. Key factors include:
  •  
• Make and model of the vehicle
• Age of the vehicle
• Add-ons opted for
• Customer profile
• City of the customer
 
Motorists can choose the suitable coverage required for their vehicle. In case of only a TP cover, the premiums are regulated by the Insurance Regulatory and Development Authority of India (IRDAI).

What Makes a Package Motor Insurance Policy Attractive?

    • • Extensive coverage: A package motor insurance provides protection to the insured’s own vehicle, personal injuries to oneself and passengers based on the type of policy chosen. For instance, a package policy will cover the damages caused due to rain or natural disasters like floods and earthquakes. If the vehicle owner has only a third-party cover, they would have to bear the expenses arising out of such events from their own pocket.
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    • • Value for money: Car owners can be at ease, as they do not have to fret over costly repair expenses. In fact, if they take add-ons such as depreciation cover and consumables, the only requirement would be for them to pay for the voluntary excess (in the case opted for) and compulsory deductibles during the claim amount. Note that unless the insured has opted for a zero depreciation cover, the depreciation in addition to the deductible would be payable out of pocket.
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    • • Relevant Add-ons: Unlike a third-party car insurance cover that gives the applicant limited coverage on their vehicle, package insurance offers enhanced coverage options. Also, it can be further leveraged by opting for add-on covers such as zero depreciation cover, roadside assistance, engine protection and passenger cover etc., at a small added cost.
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    • • Option to customize IDV (Insured’s Declared Value): IDV is the current market value of your car. A lower IDV can result in a lower premium, which can be tempting, but it also offers lower coverage in case of theft or loss of the vehicle. New-age insurers offer the benefit of customizing the IDV of the vehicle (subject to prescribed limits) while opting for insurance, and we suggest taking adequate cover.
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  • Events Covered Under a Package Insurance Cover

  • Accidental damage: If the insured or the insured’s car suffers any loss due to an accident, a package cover will pay for the damages.
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  • Theft: Car thefts are not very common in India. However, a few localities are prone to thefts, and hence, such an eventuality cannot be ignored completely. If an insured’s car gets stolen, they can file a claim for the same if the vehicle is covered under a package motor insurance policy.
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  • Damage caused by natural disasters or severe weather: Damages sustained by the vehicle due to natural disasters such as floods, earthquakes, hurricanes, tornadoes, etc., can be covered under a package insurance scheme. People who live in disaster-prone areas would benefit by opting for one such policy. For example, residents that live near the coastal belt can insure their vehicles against damages from frequent cyclones and floods that occur during monsoons.
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  • Vehicle damage caused due to civil disturbance: Due to the political instability in certain areas of the country, often, vehicles tend to sustain damages in the event of riots or violent protests. Such damages too are covered under a package policy.
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  • Fire: Destruction to the car caused by fire can be recovered by opting for a package insurance policy. Such covers reimburse damages caused due to garage fire, engine fire, and fire caused due to mechanical dysfunction.
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What’s Not Covered In Package Motor Insurance
 
Certain events and incidents may not be covered even if you have a package motor policy. One such example is if your vehicle endures damage due to a collision, then a car insurance claim cannot be made. A few other situations that are not covered under the package insurance cover include:
 
 
Electrical or mechanical breakdown: Generally, under the standard motor policy, a mechanical and electrical breakdown is not covered unless the insured can prove that damage was caused due to flooding.
 
 
Driving without a license: In case you are found driving the car without any valid driving license, then the damages and/or losses incurred will not be covered.
 
 
Drunk driving: A package policy does not cover any losses or damages incurred if you are caught driving the car under the influence of alcohol.
Damage to tyres: It does not cover any loss or damages to the tyres of your vehicle unless it is a direct result of a car accident.
 
 
Loss caused due to nuclear weapon/war: It does not cover any loss or damage caused to your vehicle as a result of war, mutiny, nuclear weapon or other such dangers.
 
 
Advantages of Opting for Package Insurance
 
Covering damage to one’s own vehicle: It ensures that the insured wouldn’t need to bear the resulting financial loss regardless of the severity of the damage. However, the cover wouldn’t pay for the exclusions that are explicitly mentioned in the policy document.
 
 
Covering third-party damage: In cases where the insured ends up injuring another person due to their negligence, a package insurance policy guarantees the coverage of the loss caused to the third party. This policy covers the non-criminal liability expenses even when the insured is proven at fault and has caused bodily or property damage to a third party.
 
 
Provision of add-on covers: Facilities such as zero depreciation cover and engine protection cover are not offered under a third-party liability policy, but they can be bought as add-on covers to ensure maximum protection from unfavorable events.
 
 
Procedure of Filing a Package Insurance Claim
 
Step 1: Registration of claim: The insured would be required to intimate their insurer about the claim. This can be done by visiting the official website or by writing to the insurer via email.
 
 
Step 2: Submission of the form and documents: The insured will need to download and fill the claim intimation form with details of the insurance policy, insured vehicle, owner of the insured car, etc. In cases of theft, the insured may also have to submit a copy of the First Information Report (FIR).
 
 
Step 3: Survey the damages: In this step, either one can perform a self-survey or opt for a digital survey . If the insured opts for self-inspection, the insurer will require you to share images for inspecting the damages caused to the vehicle. In the absence of a self-survey facility, the damages are evaluated by a surveyor or a workshop partner.
 
 
Step 4: Tracking the claim: Once the insurer is informed and the claim form is submitted along with the required documents, the claim is processed. The insured can track their claim status on the insurer’s website or a designated portal.
 
 
During renewals, one can also upgrade their policy from a third-party cover to a package insurance policy. The process of renewing car insurance has been made simple by new-age Insurtech companies. After choosing the insurer, policy and add-ons of one’s choice, the process can be initiated by filling in the vehicle details like make, model, variant, registration date and previous policy details.
 
 
Despite the extensive coverage a package motor policy offers, you may still wonder if you should opt for a package cover or stick to only a third-party cover. It is more effective to have package car insurance for a relatively new vehicle as the market value would be high, and any potential damage can result in a huge financial burden.
 
 
Bottom Line
 
Even if one does not choose a package coverage, it is important to bear in mind that in case of any unforeseen damage to the car, the steep bill and potential losses will be borne by the individual alone. Hence, it is necessary to weigh the costs of such potential repairs/ fixes against the premium that one would pay towards a package insurance cover. In most cases, opting for a package policy is a smarter option as it covers the insured against most forms of unforeseen events or damages that can be caused to their vehicle.
 

Source: Forbes

4 Benefits of Buying Engine Protection Cover for Your Car4 Benefits of Buying Engine Protection Cover for Your Car | Deeva Ventures Pvt Ltd

4 Benefits of Buying Engine Protection Cover for Your Car

Engine protection car is one of the most important add-ons covers that are offered by motor insurance companies in India.

 

Pays for the Most Expensive Car Part

The engine is considered the most expensive part of a car. Naturally, the cost of replacing the engine or any of its parts can cost a lot of money. 

 

Besides, repairing the car’s engine is also quite expensive. But with an engine protection cover, you don’t have to worry about how much money will it cost to get your car’s engine repaired or replaced.

 

Ideal for People Living in Flood-Prone Areas

People who reside in low-lying areas prone to floods or water-logging often find their car’s engine damaged due to water ingression. 

 

The engine protection cover will ensure that the cost of repairing your four-wheeler’s engine will be covered by your insurer every time water enters inside the engine.

 

Comes to the Aid of New Cars

If you have recently purchased a new car, any unfortunate damages to the vehicle’s engine can burn a big hole in your pocket as the engine parts of a new car will be expensive. But if you have purchased an engine protection cover with your motor insurance policy, the cost of your car’s engine parts will be covered no matter how expensive it may be.

 

Things to Keep in Mind When Buying Engine Protection Cover

The engine protection cover comes with certain terms and conditions that apply to car owners who buy this add-on cover. 

 

Take a look at the things that you must keep in mind if you are considering buying the engine protection cover:

 

  • 1. The engine protection add-on cover is not available for cars that are older than five years.
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  • 2. This cover can only be purchased by people with comprehensive or own-damage car insurance policies. This is because engine protection cover is not available under third-party liability car insurance.

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  • 3. Since it is an add-on cover, a car owner needs to purchase the engine protection cover by paying an additional insurance premium at the time of purchasing the best car insurance.

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  • 4. Most motor insurance companies allow car owners to make up to two claims under their engine protection cover.
 

4 Things to Keep in Mind When You Renew a Car Insurance Policy | Deeva Ventures Pvt Ltd

4 Things to Keep in Mind When You Renew a Car Insurance Policy

 

A month before your car insurance policy comes to an end, you usually get a reminder to renew your policy from your agent. 

 

As you know, renewing third-party insurance is mandatory, according to the Motor Vehicle Act of 1988, but most of you would also look at add-on covers or own damage to vehicle policy to protect your car in case of an untoward incident.

 

1. Look at the type of policy you want for your car

You can opt for your damage to your vehicle that helps you stay covered against damage caused to your vehicle due to accidents like fire, theft, etc. 

 

In case of an accident, your damage cover compensates you for the expense to repair or replace parts of your damaged vehicle.

 

You can also look at add-on covers which include depreciation cover, passenger assist, consumable cover, engine safe cover, GAP value cover, key loss cover, and roadside assistance cover.

 

2. Read policy wordings

Policy wordings are different for different car insurance policies. So, the cover you have for the damage to your vehicle will be different from an add-on insurance cover. 

 

Choose the type of policy you want for your vehicle and read the policy wordings carefully before you buy it.

 

3. Renew your policy on time

Many policyholders tend to not renew their existing policy and they lapse. According to the new IRDAI rules, if premiums aren’t paid on time, policyholders stand chance to lose no claim bonus (NCB) that they accumulated when the policy was in force.

 

To sum it up, while third-party car insurance is mandatorily needed to be renewed annually, you also need to constantly check on the policies you have purchased for your vehicle to ensure you don’t struggle in case of damage.

 

 

4. Use our customer support

We are here to help you and if you have any queries about your policy, so just contact us.

 

Our objective is to make the motor claims and renewal process as efficient and hassle-free as possible for the policyholder.

 

 

Disclaimer: For more details on risk factors, terms & conditions please read the sales brochure carefully before concluding a sale. The discount amount will vary subject to vehicle specification and place of registration.

 

 

4 Misconception’s About Car Insurance

4 Misconception’s About Car Insurance

It is quite a well-known fact that according to Indian law, while purchasing a new car, purchasing a car insurance policy is mandatory.

 

A car insurance policy would help in the protection of not only the car but also the person driving the car in case of any accidents or damages. 

 

But there is a lot of misinformation floating around related to car insurance plans, which leads to misconceptions among vehicle owners. 

 

1. You are a safe driver and do not need car insurance

You might think that you are an experienced and safe driver, so there is no need to purchase car insurance.

 

This is a wrong perception. You might be sure that you are one of the safe drivers but you cannot be sure about the conduct of other drivers and road conditions.

 

In case your car meets with an accident and your car is not insured, then you would have to pay all the expenses incurred in damage of a third party car and also your car out of your pocket. 

 

Moreover, the Motor Vehicles Act, 1988 makes it compulsory to have a third party car insurance policy while driving cars on the Indian roads.

 

2. Your insurance premium would be low if your car is older

 Usually, it is said that the older the car, the lower would be the premium. It is believed that the IDV (Insured Declared Value) of your car is the main factor determining your car insurance premium. 

 

So, if your car is older, then the IDV would be also less, and hence, you would obtain cheaper insurance.

 

However, this is not true always. In addition to the IDV of your car, there are several other factors as well, which determine the insurance premium of your car. 

 

These factors can be your previous driving history, the distance you have traveled, your claim history, the category of coverage you have purchased, your NCB, etc.

In case you have made numerous claims in the previous year, then your premium for the current year would be high.

 

3. Purchasing a car insurance policy is a slow process

The fact is no, it’s not a slow process anymore. Technological advancements have made the entire process easy and quick.

 

You can purchase and renew car insurance policies online conveniently and with minimum documentation.

 

You just need to fill in the basic details associated with your car, compare car insurance plans online, and make an informed decision.

 

Your car insurance would be in your mailbox within some time. This process is cheaper and very efficient.

 

4. Claim settlement is a very painful process

This is one of the most common car insurance myths. You might believe that in case of an incident involving your car, you might have to take a lot of pain to get a CLAIM

 

However, this is not a fact anymore. Claim settlement procedures are quite easy and can be done online conveniently. 

 

You will have to log in to the insurance company’s website and fill up the claim form. In case of successful claim registration, you would be asked for submitting your documents.

 

You can obtain assistance anytime during the claim procedure by connecting with the customer care representatives or by referring to the FAQs present on the company website.

 

Conclusion

So, these are some of the most common and widespread car insurance myths among vehicle owners.

 

You must understand the differences between myths and the realities associated with them to fully appreciate the car insurance cover that you own.

 

Make sure to compare car insurance policies online and buy the ones which suit your requirements by providing maximum coverage with a nominal premium. 


Motor Claim Denied

8 Easy Tips to Prevent Car Insurance Claim Rejection

Rejections, of all kinds, can be disappointing. If the rejection is related to car insurance, it can affect your bank balance. Insurance doesn’t offer instant gratification. It is a promise based on certain terms and conditions. 


It is natural for a policyholder to feel offended if the insurance company doesn’t live up to the promise of claim settlement. But there are two sides to a coin. And the car insurance company has its reasons for claim rejection.


1) Don’t Increase Consequential Loss
Consequential loss occurs when you try to run the car after an accident. This is a major loss in terms of damage. For example, if your car is submerged in water and you try to start the engine. 


The car had already suffered water damage. But because you tried to start the car, additional water has affected the engine due to which the hydrostatic lock got activated. 


In this example, your insurer will pay only to cover the initial damage caused by the water and not the expenses related to the hydrostatic lock. This consequential loss claim will be rejected.


2) Respect the Law
An insurer will honor a claim only when unintentional damage has occurred. When you break the law, your intentions are not in the best interest of you or those around you. 


Thus, your claim will be rejected. Always make sure that you respect the law. For example, make sure your driving license is valid.


3) Follow the Claim Process
Each insurance company has a set of rules when it comes to their claim process. To get your claim honored, you need to follow your insurer’s claim process. This could include intimating the insurance company within stipulated time under the right conditions, or submitting the required documents, or coordinating with the claims team.


4) Be Honest
In case of an accident where multiple parties are involved, only the true claim will be honored. 


Your claim will be rejected if you are found to be guilty of falsification. Remember that insurance companies carry out a thorough investigation of the incident via various means. Thus, always be truthful about what exactly caused the damage or injuries.


5) Renew in Time
Always make it a point to renew your car insurance policy in time. A claim will be rejected without any investigation if you raised it against an expired policy. Renew your policy and go through the inclusions and exclusions thoroughly if you want your claim to be honored. 


Remember that reading the fine print will help you get a clear idea about the policy. You need to be sure that you raised the claim in a correct manner and against a corresponding inclusion.


6) Inform about Changes
One of the most common reasons for a claim getting rejected is that the insurer is not aware of the changes made to the car. For example, installing a CNG kit in your car. 


Your claim may be rejected if the fuel type on your car insurance policy does not match the actual fuel type of your car. The same goes for any modification. You need to inform your insurer about all types of car modifications.


7) Don’t Repair without Informing
Last but not least, do not send your car for repairs without getting a go-ahead from your insurer. This is because, after an accident, your car will be surveyed for the extent of damage it has suffered. 


Your insurer will give an approximate estimate of the expenses related to repairing this damage. Your claim can be rejected if you get your car repaired without a survey.


8) Co-operate
You need to raise a claim within a specified period and cooperate with the claims team regarding details related to the event against which the claim is raised. For example, the claims inspector might ask you some questions if you have raised a claim for a car accident. You need to answer those questions honestly.


If you fail to provide an honest narrative (don’t rely on the garage) or if you do not provide supporting documents (if needed), the insurance company might follow up with you for a while but eventually will reject your claim based on non-cooperation.

Worried about safe drive?

Here are 16 Additional Coverage for your Vehicle you never knew

  1. Return to InvoiceThe IDV shall be taken as the On Road Price which is defined as Manufacturers’ Selling Price of the vehicle+ Road Tax +Registration Charges as applicable for the class/make a model of the vehicle as supported by the invoice of original purchase issued to you by the insured and documents in support of the charges payable under the head Road Tax and Registration Charges.                                       
  2. Depreciation Waiver – In the case of an accident leading to a partial loss, there will be No depreciation charged on the cost of the parts to be necessarily replaced.            
  3. Daily Cash Allowance – Insurance Company will pay you a Daily Cash Allowance in case your vehicle is laid up in an authorized garage/ service station for repairs of accidental damages covered under the Policy and the vehicle is essentially required to be laid up for more than 3 days at the garage.                                                                    
  4. NCB Protection – In the event of Claim for (a) Accidental damage to the windshield by breakage  (b) Theft of vehicle or theft of electronic /electrical/nonelectrical accessories  (c) In case you go for repair of a rubber/plastic or fiber part damaged in an accident instead of replacement.                                                                                                                                                                                                                          Subject to no other claim for damage to the vehicle under the Policy, while determining the renewal premium these claims shall not be counted (taken as not happened) and NCB shall be protected                                                                                                
  5. Loss of Driving Licence / Registration Certificate – In the case where the insured suffers a loss of Original Driving License or the Original Registration Certificate, the Insurance company will provide compensation of up to Rs 500 to obtain a duplicate License or RC.                                                                                                                            
  6. Emergency Hotel or Transportation Expenses – Insurance company shall reimburse you the cost of expenses incurred for accommodation for an overnight stay and /or those for travel to your place of residence or nearest city on your itinerary.                                                                                                                                                                  Necessarily incurred in the event of your vehicle meeting with an accident en-route and it is impossible to drive the insured vehicle due to an accident and the vehicle had to be towed or if the vehicle is stolen.                                                                                    
  7. Electrical and Mechanical Breakdown Coverage – In event of an electrical breakdown due to ingress of floodwaters without the vehicle meeting with an accident Insurance company shall pay you to cost of necessary repairs subject to the same not being payable in manufacturer’s warranty                                                   
  8. Key Replacement Clause  Covers the (a) Cost (locksmith cost) to replace the locks and keys if the vehicle is broken into or stolen and recovered (b) The labor charge for opening the car if you have lost the keys or (c) Cost of the replacing your car keys which are stolen or lost.                                                                                              
  9. Loss of Personal Belongings Clause – Covers loss of personal belongings viz baggage, clothes, bag, etc belonging to you and your dependant family members from the car by breaking into the locked car by visible means or by any peril as insured under the Motor Vehicle Policy                                                                                 
  10. Tyre Protection Cover Damage to tyres and tubes are covered only if the vehicle has met with an accident resulting in damage to the tyres and/or tubes.                          
  11. Engine Protection Cover – This add-on provides coverage towards damages or losses to the insured vehicle’s engine. The add-on compensates you for the replacement or repair of your car’s engine or parts.                                                              
  12. Consumable Cover is an add on the insurance coverage that pays for the cost of consumables in Car Insurance required to be replaced or refilled in the event of an accident of your car.                                                                                                            
  13. Accidental Injury Compensation for Owner/Family/Driver – While traveling in the insured vehicle the Owner/Family/Driver is covered against the risks of assault or any other bodily injury leading to Death/Permanent total/Permanent Partial disability in any accident involving the vehicle.                                                                        
  14. Personal Accident Cover Owner/DriverYou are covered 24X7 for an amount of Rs 3 lacs/4 lacs/ 5 lacs/10 lacs against the risks of assault or any other bodily injury leading to Death/Permanent total disability in an accident when you are traveling in the insured car. This is in addition to the restricted Compulsory Personal Accident cover for Owner Driver.                                                                                                             
  15. Accidental Hospitalisation for FamilyThis is a special clause for reimbursement of inpatient hospitalization expenses incurred for accidental injuries suffered whilst traveling in the insured vehicle only. The cover is available as a single limit for all the named family members.                                                                                                            
  16. Road Side Assistancehelp’s you in times where you need roadside assistance. Whether it’s a small mishap or a flat tyre, a 24×7 roadside assistance cover can help you in times of such troubles, without even accounting it as a claim.

Motor insurance plan is mandatory to protect your vehicle from financial burden in case of any damages. Be careful in choosing the right additional coverages for your vehicle.