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Common Reasons For Car Insurance Claim Rejection

Written by Sumit Arora
Updated On Oct 16, 20232 min read
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There are many reasons that could lead to the rejection of your car insurance claim settlement. Car insurance claims can be very tricky. Car insurance claims can be approved and rejected based on the terms and conditions of the insurance provider. Read along to know more about common reasons for car insurance claim rejection.

Car insurance claim settlement can be very tricky. Car insurance claims can be approved and rejected based on the terms and conditions of the insurance provider. Facing a car insurance claim rejection can impact your back balance. Having a car insurance cover does not mean immediate claim settlement, it solely depends on the terms and conditions of the insurance providers.

Imagine a situation where your car is heavily damaged in an unforeseen event and your insurance provider rejects your car insurance claim due to some reason. In this case, the cost of repair of your car shall be paid by you which can affect your budget. Hence, it is very important to avoid making any mistakes and avoid claim rejection. 

Common Reasons For Car Insurance Claim Rejection

Common Reasons For Car Insurance Claim Rejection

Below mentioned are some instances which can be avoided to avoid claim rejection for your car insurance: 

  • Undisclosed Car Modifications: After you purchase a car and make modifications to it, to enhance the look, performance or security of your car then you must inform your insurance provider at the time of filing the proposal form. Any modification on your car affects the premium calculation for your car insurance policy such as fitting a CNG kit may increase the premium while other modifications may decrease the premium. It is important to notify the insurance provider about the car modifications at the time of policy issuance. If the car insurance provider finds any modifications which were not mentioned earlier, the insurance company can reject your claim. 
  • False Claim: It is advised to never make false claims to avoid the repair expenses of your car. The concept of any insurance is based on honesty, the insured and the insurance provider should be honest to each other. If the insurance provider finds about a false claim made for your car insurance, the provider can reject the claim and terminate the policy or file legal charges against you. 
  • Violation of Traffic Laws: Motor insurance works in coordination with traffic rules and regulations. There are several traffic rules and regulations that a person has to follow, to ensure safety for themselves and others on the road. Insurance providers only approve claims for unintentional damages and violation of traffic rules or regulations is considered an intentional act, as it can lead to accidents. If you violate traffic rules such as driving without a seatbelt/license and drinking and driving, your insurance provider can reject the claim. 
  • Expired Car Insurance Policy: If you're a car owner then you can file for a claim only if you have an active car insurance policy. In case your car insurance policy has lapsed or has expired, the insurance company is not entitled to approve your claim and pay for the damages of your car. The insurance provider can deny the claim for your car insurance if your policy is expired or lapsed. 
  • Removing the Car from Accident Spot: In case you meet an accident while you are driving in your car, it is advised to not remove your car from the accident spot as the insurance provider will inspect the damaged car at the accident point itself as per the claim process. If you take your damaged car back to your place, you might violate the claim process which can lead to the rejection of your car insurance claim.

Also Read:- How to Cancel A Car Insurance Policy and Receive A Refund? 

To Conclude

Above mentioned aspects can help you avoid the chances of claim rejection for your car insurance policy. You must be truthful at the time of filing the car insurance proposal form, revive your policy on time, abide by the traffic rules and regulations, follow the claim settlement process of the insurance provider, inform about the car modifications. Alway intimate your insurance provider about the accident before sending your car for repair. You can avoid these simple mistakes and eliminate the risk of facing a claim rejection for your car insurance policy.

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All About Car Insurance Frauds In India

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.

Disclaimer

This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.
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Written by Sumit Arora
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 Sumit is an insurance industry veteran with more than 20 years in the industry. Sumit is a frequent columnist and speaker at major insurer conventions and is a heard name in insurance circles In his free time, Sumit likes to spend time with his family and go on trips

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