When Not to File for a Car Insurance Claim?
It is mandatory to have car insurance to use the vehicle. In case of any accident, you can protect yourself from financial loss with the help of a car insurance. Heavy fines are levied if you are caught driving your car without insurance.
However, it is not always the best idea to use it for every minor scratch or dent. In India, filing a claim for small damages can sometimes cost you more in the long run than paying for the repairs yourself.
Factors to Consider Before Filing a Claim:
Do consider the below mentioned points before you file for a claim:
- Cost of Repair vs. Your Deductible: Every car insurance policy in India has a deductible. This is the portion of the repair bill you must pay before the insurance company pays the rest. If the repair bill is lower than or equal to your deductible, the insurer will pay nothing. You should pay for it yourself.
- Compulsory Deductible: Fixed by the regulator (IRDAI). It is typically Rs.1,000 for cars under 1500cc and Rs.2,000 for cars above 1500cc.
- Voluntary Deductible: An additional amount you may have agreed to pay to lower your premium.
- No Claim Bonus: The No Claim Bonus (NCB) is a reward for safe driving. If you do not make a claim for a full year, the insurer gives you a discount on your next year's premium. If you file even a small claim, your NCB drops to zero next year.
- Future Premiums: Insurance companies track your claim history. If you are a frequent claimer, insurers may view you as high-risk. This can lead to higher charges to renew your policy in the future.
When Should You Not File a Car Insurance Claim?
Some of the cases when you should not file a car insurance claim are mentioned below:
- Damage is Minor: If you have a broken wing mirror, a cracked bumper, or a minor scratch, the repair cost at a local garage is often quite low. These costs are usually less than the NCB you would lose.
- Repair Cost is Less Than the Deductible: If your deductible is Rs.2,000 and the repair bill is Rs.1,500, the insurance company will not pay a single rupee. Filing a claim here is pointless.
- High NCB: If you have driven safely for 4-5 years, you likely enjoy a massive 50% discount on your own-damage premium. Save your claim for major accidents or theft where the loss is substantial.
- Third-Party Damage is Manageable: If you accidentally graze another person's car and the damage is minimal, it is often better to settle it mutually with the other driver. Involving the police and insurance for tiny amounts can be time-consuming and complicated.
How to Raise a Claim After Accident?
Follow the steps given below to raise a claim for your own car after a major accident:
- Safety First: Ensure you and your passengers are safe. If necessary, move the car to the side of the road to avoid traffic.
- Inform the Insurer: Call your insurance company’s toll-free number or use their mobile app immediately. Most insurers require notification within 24 to 48 hours.
- Take Evidence: Take clear photos and videos of the damage to your car and any third-party vehicle involved. Note down the registration number of the other vehicle.
- File an FIR: This is mandatory if there is third-party injury, death, major property damage, or theft. For minor damages like hitting a pillar in your parking lot, an FIR is usually not required.
- Wait for Inspection: Do not repair the car before the insurance company inspects it. If you repair it first, your claim will likely be rejected.
- Submit Documents: Provide the necessary paperwork.
Documents Required to Raise a Claim:
The following documents are required to raise a claim:
- Original insurance policy as well as copy
- FIR
- Car’s registration certificate
- Your driving licence
- A summary of the damage as estimated cost of the repair
- Medical bills (in case of injury)
FAQs on When Not to File for a Car Insurance Claim?
- Can I pay the repair cost now and claim reimbursement later?
Yes, but you must inform the insurer before repairs start. They need to inspect the damage first.
- What is Compulsory Deductible?
It is a mandatory amount you must pay for every claim.
- Will my premium increase if I file a claim?
Yes, you will lose your NCB discount, which means you will pay the full standard premium at the next renewal.
- Can I file a claim for a scratch on my car?
Yes, you can. However, it is not recommended because the cost of fixing a scratch is usually low, and you will lose your NCB benefit.
- Is an FIR mandatory for all car insurance claims?
No, an FIR is generally not required for minor accidental damages to your own car. It is mandatory for theft, third-party injury, or major accidents involving other vehicles.
- How many claims can I file in one year?
Most comprehensive policies allow unlimited claims. However, some Zero Depreciation add-ons may limit you to 2 claims per year.
- What happens if I am driving without a valid licence?
Your claim will be instantly rejected. A valid driving licence is a mandatory requirement for insurance coverage.
- Can I transfer my NCB to a new car?
Yes, the NCB belongs to the owner, not the car. If you sell your old car, you can transfer the NCB certificate to your new car to get a discount.
- Does Third-Party insurance cover my car's repairs?
No, third-party insurance only covers damages you cause to others. It does not pay for repairs to your own car.
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