4 reasons that let car insurers deny a claim2 min read . Updated: 24 Jul 2018, 12:48 PM IST
Buying a car insurance policy is not enough. Invalid driving licence, drunk driving, improper use of vehicle and insurance in a different name could be some reasons your claims might be denied
A car policy covers third party liability—that arises if your vehicle causes damages to a third person—as well as insures your vehicle against theft and damages. But having a cover is not enough to get your claim, you need to be a responsible car owner and driver too. We list out four main reasons why even if you have a valid car insurance policy, your claim can be denied by the insurer.
Invalid driving licence
At the time of buying a car or a car insurance, you may not be asked to show a valid driving licence, but that’s a basic requirement for driving a car. If you don’t have a valid driving licence, the insurer is well within its rights to deny your claim. At the time of making a claim, the insurer will ask you for your driving licence; so make sure you have a valid driving license and don’t let anyone who doesn’t have a driving licence drive your car.
Drunk driving is negligence
Drunk driving implies you are negligent and insurers cover a risk not a highly likely event. An accident is a highly likely event when a person is driving under the influence of alcohol, hence it is not covered.
In fact, a car insurance brochure we looked at stated in its exclusion that any damage by a person driving under the influence of alcohol is not covered by the policy.
Improper use of vehicle
If you buy a car for personal use then make sure it’s not used for commercial use. At the time of making the claim, the insurer will typically appoint a surveyor to inspect thoroughly the reasons for the damages. If the surveyor finds out that a personal car was being used as a taxi, your claim can be denied because the policy was taken for a personal car.
Insurance in different name
When you buy a car you need to change the ownership in the registration certificate, but make sure you also change the ownership in your insurance policy. This is because the original owner, after having sold off the car, has no insurable interest in the vehicle and insurance needs to be bought by a person that has an insurance interest.
Doing this is simple: approach the insurer, show the new registration certificate and get the policy transferred.
Buying a car insurance policy is not enough. Since insurers do not pay for negligence, you need to be responsible as a driver to be able to make a claim in case of damages.