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Reasons for Rejection of Car Insurance Claims and How to Avoid Them

Published On May 11, 2021, Updated On May 25, 2021

This article provides a detailed guide on reasons why car insurance claims get rejected. In this article, you will also find tips using which you can avoid such claim rejection scenarios.

Rejections are hard to deal with, be it for visas or insurance claims. Rejection of a car insurance claim can put you in distress and confusion. Thus, it is important to know the reasons why your insurance claim can get rejected.  This article will take you through a number of reasons which can lead to a rejection of your car insurance claim and will also provide a few tips on how to avoid it.

Reasons for Rejection of Car Insurance Claims and How to Avoid Them

Common Reasons For Car Insurance Claim Rejection

Following are some common reasons which lead to a rejection of a car insurance claim - 

  1. Not Telling The Truth

A car insurance policy is not for making profits, but for compensating the losses incurred by the policyholder. It is based on the principle of ‘utmost good faith’. Thus, concealing facts or their misrepresentation amounts to fraud. Such an act can result in legal complications apart from being denied the claim amount. Thus, you should always state the facts about the incident and your car insurance claim to your car insurance provider to avoid a rejection of your claim.

  1. Non-Disclosure of Car Modifications

Car enthusiasts often get their car parts modified either to enhance the car’s performance or appearance. Such modifications which enhance the car’s performance and speed can result in a degradation of the car security and, thereby increasing your car insurance premium. Thus, if you do not disclose the information related to such modifications and later on get involved in an accident or any other unfortunate event, it is very likely that your insurance provider will reject your car insurance claim.

  1. Lapsed Policy

All insurance policies come with a fixed validity tenure after which they need to be renewed in order to keep them active and enjoy the benefits available under them. In case you fail to renew your lapsed policy, you would not be able to make a claim under it and receive the benefits of insurance. Thus, if you make a claim under an lapsed car insurance policy, your claim will be rejected by your insurance provider.

You may also like to read:- Common Mistakes To Avoid During Purchase And Renewal Of Car Insurance

  1. Disobeying Rules And Regulations

Car insurance works hand in hand with the law. Underage driving, drunk driving, driving without a valid licence, etc are punishable offenses that may lead to rejection of the claim if practiced during the accident. If the insurance company finds that you have not adhered to the law during the accident, then it is very likely for your insurance claim to get rejected. 

  1.  Commercial Use

Insurance policies have specific classifications to cover different purposes of the vehicle. There are separate car insurance policies for private and commercial vehicles. If your insurance policy is for a privately owned car, it is likely to be rejected if the accident occurs while you are using it for commercial purposes.

Ways To Avoid Rejection Of Insurance Claims

Following are some of the easy tips which you can practice to avoid the rejection of your car insurance claim - 

  1.     Being Truthful And Cooperative With The Insurance Claims Team

Raising the claim in time and being honest about the accident with the claims team is the key to getting your insurance amount. The claims inspectors may question you about the incident and ask for certain documents. It is beneficial to provide honest answers and the required documents to avoid rejection of your claim. 

  1.     Renew Your Policy On Time

Renewing your insurance policy is crucial as you cannot predict accidents. Being prepared for a disaster is safer than being uncovered. No insurance company approves insurance claims if the policy has lapsed. It is always advised to renew your policy and be up-to-date with it. 

  1.     Don’t Repair Your Car Without Informing Your Insurer

Repairing your car without informing your insurer can result in the rejection of your insurance claim. This is because the company conducts surveys on the damaged car after the accident to insure it. It is important to get a thumbs up from the insurer to proceed with the repairs. 

  1.     Don’t Disobey Traffic Laws

Make sure that you abide by the laws while driving your car. Any accident that occurs when you violate the law will result in the rejection of your insurance claim.

Also Read

Insurance Tips to Consider Before Buying A Car

 Take Away

Claiming your car insurance may seem like a complicated procedure, but it is important to abide by the right protocols at every step to ensure that you remain safe and avoid rejection of your claim. Make sure you do not conceal facts from your insurance provider at the time of making a claim. Also, try to renew your car insurance policy in time so that you do not land up in a situation of a claim rejection due to the expiry of your policy.

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