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Can the family of a person who owns a personal accident insurance policy get the claims if he/she dies in an accident while riding a two-wheeler of capacity which is more than that mentioned in the policy? In an incident that occurred last year, HDFC Ergo denied accidental death claim made by family members of a Ludhiana-based person as the engine capacity of the two-wheeler he rode was over 150cc capacity.

The incident got highlighted when the letter found its way to Twitter.

The rejection scenario: According to the tweet, the letter issued by HDFC Ergo stated, "We would like to draw your attention. Your claim has been declined due to the below-mentioned reason, which is the basis for disallowing the claim, an extract of which is mentioned below for your ready reference."

"As per the submitted documents, insured was dead on 19/04/2020 due to head injury. Insured was riding 346 cc bike and as per policy terms and conditions claim is not payable under general exclusion clause 8, for bodily injury sustained while or as a result of driving motorcycle or motor scooter above 150 cc."

The tweet though did not tag the official Twitter handle of HDFC Ergo. 

The insurer has, however, responded to LiveMint's query. HDFC Ergo said, "The specific case being highlighted in social media is an old case, and in fact the claim is already paid to the customer. We would like to clarify that the particular exclusion which existed in all of our old products was removed in October 2020. We would also like to assure our existing and new customers that our PA (Personal Accident) policy covers all motorcycles regardless of their engine capacity (CC). We take pride in our industry-best claim settlement ratio, and the highest number of claims settled in the industry. We continue to strive to maintain this benchmark and evolve continuously to match customer needs and market changes."

What you should do in such a scenario

"While buying any insurance policy, it is important for the consumer to understand all the benefits and clauses in the insurance cover. While consumers are interested in knowing the benefits of the claim, they often tend to overlook the exclusions or disclaimers in the policies," said Indraneel Chatterjee, Co-founder, RenewBuy.

The incident clearly indicates that one should not buy insurance cover before reading its terms and conditions. It would help further if you are vigilant when renewing your policy. Take help from financial advisors at the time of policy renewal. To avoid discrepancies, you can also consider switching to a standard insurance policy, Saral Suraksha Bima, issued by the regulator, the Insurance Regulatory and Development Authority of India (Irdai) last year.

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