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When You Should Avoid To Make A Car Insurance Claim?

Written by Sumit Arora
Updated On Oct 16, 20232 min read
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Read on to learn about the many instances in which you should avoid filing a vehicle insurance claim for a variety of reasons.

Car insurance is a legal requirement for everyone who drives a car. It is required by law and provides financial protection in the event of damage or loss to the insured vehicle or third-party responsibility. When you buy a car insurance policy and file a claim, your insurance company is responsible for covering the cost of repairs according to your policy coverage. Is it, however, wise to file a claim for every blemish on your vehicle? Is it advisable to save any claims until certain circumstances? Let's look at several scenarios in which filing a claim might be a liability rather than a source of financial support.

When You Should Avoid To Make A Car Insurance Claim?

When and Why Should Car Insurance Claim Not to Be Raised?

Car insurance is the most effective approach to cover the financial costs of accidents, theft, and other types of vehicle damage or loss. However, there are several circumstances in which filing a claim will result in you losing your No Claim Bonus (NCB). As a result, you should be aware of the many instances in which filing a claim may not be a viable choice and make an educated decision. Let's take a closer look at a few of these scenarios.

  • In The Event of Minor Damage

When an automobile is used often, small problems such as dents, scratches, and broken mirrors occur frequently. Minor damages are typical when driving on congested highways, and you should avoid filing claims. Even the slightest claim can have an impact on your claim history, and your insurer may view you as a high-risk driver, raising your premium as a result of your risk profile. As a result, it's best to avoid filing a claim for minor losses.

  • When Deductibles Are Excessively High

There are two sorts of deductibles in car insurance: mandatory and optional. The former is set at Rs. 1,000 for automobiles with fewer than 1500cc engines and Rs. 2,000 for those with engines larger than 1500cc, while the latter is set by the policyholder and paid during the claim. When deductibles are greater, you should avoid filing any claims since you will be responsible for a certain percentage of the claim if your automobile is damaged. Raising a claim will now be a loss-making activity if the cost of repair is less than the deductible amount. In addition, according to the conditions of your insurance policy, you will be responsible for paying the mandatory deductible.

  • If the Repair Costs Have Been Covered by a Third Party

You may be involved in an accident as a result of the actions of a third person. According to the insurance rules, you should take note of the automobile insurance data and file a claim against their policy. If the harm is modest and the third party wants to reimburse you, you should not file a claim and resolve the matter right once. The reason for this is that the claim settlement procedure takes time, as you must notify your insurance, file an FIR, submit a claim, and so on, which can take anything from hours to days. In such a situation, reaching an arrangement with a third party for a convenient deal is the best option.

  • The Amount of NCB you Have Accumulated is Higher

No Claim Bonus (NCB) is a type of incentive offered by vehicle insurance companies to policyholders who do not file a claim during the policy year. During the renewal of your policy, your NCB benefit tends to build from a 20% to 50% reduction on your own damage component for each claim-free year for five consecutive years of the policy. In the interim, even a single or minor claim might result in the NCB benefit being terminated. As a result, you should not file a car insurance claim to prevent losing this discount. It is also no longer essential to file a claim for an amount that is less than the NCB.

Take Away

The claim is the most important component of automobile insurance that customers buy. We purchase a policy in order to get compensation for damages and losses incurred as a result of the claim amount. However, in other cases, you should avoid filing a claim in order to maintain a favourable position. You must go over the aforementioned elements before making a claim. We hope that the information in this post will assist you in making educated decisions about your auto insurance claim.

You may also like to read: 

Tips to Maintain Safety on Roads While Driving A Car

Top Factors That Determine The Premium of Your Car Insurance Plan

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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