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Top reasons why car insurance claims are denied

We hear stories of sham insurance claims all the time in the news and they are increasing by the day. In most cases, career criminals are leaching to this kind of felony as a key source of illicit income. Over the decades there have been some really high profile occurrences of exposed scams including the infamous ‘Sukumara Kuruppu’ case in which he faked his own death by murdering his business partner in a ‘car accident’ for insurance money.

On the other hand, it can be overwhelming to be involved in a car accident, bear expenses of car repair, personal treatment, property damage or third party injury, if any, only to receive a denial from your insurance provider. Do not disregard the rejection or panic. Sometimes the reason could be as trivial as a miscalculation in coding or a factual error. With veracious paperwork and an in-depth understanding of your , you can even accelerate the procedure.

Listed below are top reasons why your car insurance claim can be rejected by insurance companies:

  1. Normal Wear & Tear:
  2. Natural deterioration due to regular use of a car is not avoidable and hence you cannot be indemnified against this. This wear and tear consists of weakening of engine, scuffing of brake, suspension, peeling of paint or slight abrasion of the interiors as well as minor dents or nicks to the exterior while use.

  3. Consequential Damage:
  4. Consequential Damage occurs when you use your car despite clear red flags. Driving along a flooded road when there is another option, knowing that it can lead to engine failure is one instance. Insurance companies show zero tolerance to claims of this nature.

  5. Personal Car Insurance Vs Commercial Car Insurance
  6. If you have bought a personal car insurance, but the accident has occurred when you were using your car for commercial purpose (like hiring it out as a cab or use for official trip), then your claim will be rejected without a second thought.

  7. Intoxicated Driver:
  8. Driving under the influence of alcohol or drugs is a crime. And insurance companies will only be happy to toss your claim to reject list if this allegation is proved.

Conclusion:

It would be unfair to curse and rave about your insurance company’s hardheartedness when there were many incidents in the past that made them extra vigilant. It would be a while before we all forget the notorious Lord Brocket case, in which Mr. Brocket dismantled his Ferrari and Maserati and sold the parts at black market before reporting the cars stolen to the insurance company.

We must remember that insurance companies’ bread and butter is mainly claim rejections. Delaying accident reporting, different names on RC and insurance policy, mishap occurring outside the policy’s geographical realm can all be causes for denial. So it is important to make our claim foolproof and honest so that there is no chance of rejection. Of course if you feel that your claim is unfairly overruled, you have an option to file an appeal.

GST Update: GST of 18% is applicable on car insurance effective from the 1st of July, 2017

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Why Car Insurance Claims Are Denied Reviews

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  • Iffco Tokio Car Insurance
    "Good Policy"
    0.5 5.0/5 "Blown Away!"
    My car insurance was taken from Iffco Tokio. Through online i have purchased the policy because the premium amount is less and the coverage is high. I pay the premium amount of Rs. 6500 for that they are offering a coverage amount of Rs. 2.50 lakhs. I do not have any claim experience till now.
    Was this review helpful? 0
    , bangalore
    Reviewed on Oct 17, 2019
  • New India
    New India Car Insurance
    "Excellent Policy"
    0.5 5.0/5 "Blown Away!"
    One of my friend is working in New India so with him i bought the policy. I pay the premium amount of Rs. 15000 and this is a bumper to bumper covered policy. I got the IDV value of Rs. 6 lakhs. I do not have any claim experience and i got the no claim bonus too.
    Was this review helpful? 0
    , dindigul
    Reviewed on Oct 14, 2019
  • Royal Sundaram Car Insurance
    "Very Nice Policy"
    0.5 5.0/5 "Blown Away!"
    For my car insurance, i'm paying the premium amount of Rs. 10000 every month. I took the car insurance from Royal Sundaram because the car taken showroom members have given this policy. The policy covered with bumper to bumper facility.
    Was this review helpful? 0
    , hyderabad
    Reviewed on Oct 13, 2019
  • ICICI Lombard Car Insurance
    "Satisfactory"
    0.5 3.0/5 "Satisfactory"
    At the time of purchasing the car, I got an insurance from ICICI Lombard through the showroom which I have continued for 5 years but am not having car. It was satisfactory and had a neutral experience. I used to get reminder msg and calls for the policy renewal. I had a claim and which was dealt by showroom and the process was hassle free. Actually, the policy was bit costlier than the insured value of vehicle before 3years ago.
    Was this review helpful? 0
    , kanpur
    Reviewed on Oct 12, 2019
  • HDFC Ergo Car Insurance
    "Good"
    0.5 4.0/5 "Great!"
    HDFC ERGO given me a third party insurance and for one time, they have charged me only 6K. The policy validity is 4 years. Its a zero dep policy. Its good but I don't have claim experience. I have received the insurance paper through post. Overall good.
    Was this review helpful? 0
    , pune
    Reviewed on Oct 08, 2019
  • New India Car Insurance
    "Good Policy"
    0.5 2.0/5 "Expected more"
    My car insurance was taken from New India because the car dealer has provided me this policy. I had paid the premium amount of Rs. 33000 and this policy gives me a coverage of 100%. My claim experience is good and they had processed the claim in 24 hours.
    Was this review helpful? 0
    , bhopal
    Reviewed on Oct 04, 2019
  • United India Car Insurance
    "Better"
    0.5 4.0/5 "Great!"
    I have Hyundai car which is more than 18years, United India is charging me insurance fee around 3500rupees for one year policy. They are sending the insurance paper on time. Its a third party insurance. The claim is not applicable. IDV is less which can be better.
    Was this review helpful? 0
    , palakkad
    Reviewed on Sep 29, 2019
  • Reliance General Car Insurance
    "Easy and Good policy"
    0.5 5.0/5 "Blown Away!"
    I am having a car insurance from Reliance. When i met the accident, i sent a photo to them and the executive came to the place and they took the photo and they have provided me a claim amount of Rs. 1.50 lakhs but the total damage is Rs. 2.5 lakhs. They have given me a claim in 45 days.
    Was this review helpful? 0
    , erode
    Reviewed on Sep 24, 2019
  • United India Car Insurance
    "Its Good"
    0.5 4.0/5 "Great!"
    Currently I taken car policy from United India by paying the premium around Rs.14,000 for per annum for my toyoto car. It has bumper to bumper zero depreciation plan and they do have road side assistance, break down service, 24 hours service. The customer service is good interms of reminder. alerts.
    Was this review helpful? 0
    , vijayawada
    Reviewed on Sep 20, 2019
  • Iffco Tokio Car Insurance
    "Need improvement on the cash garages"
    0.5 4.0/5 "Great!"
    In 2017 I used Iffco Tokiyo for the car protection, the premium cost was economical. But they don't have cash less garages for certain demise hence I have moved other insurance company. The online option is very good for renewal and other purpose.
    Was this review helpful? 0
    , sonipat
    Reviewed on Sep 19, 2019
  • Iffco Tokio Car Insurance
    "Need improvement on the cash garages"
    0.5 4.0/5 "Great!"
    In 2017 I used Iffco Tokiyo for the car protection, the premium cost was economical. But they don't have cash less garages for certain demise hence I have moved other insurance company. The online option is very good for renewal and other purpose.
    Was this review helpful? 0
    , sonipat
    Reviewed on Sep 19, 2019
  • New India Car Insurance
    "Good Service"
    0.5 5.0/5 "Blown Away!"
    For my Honda city car I took New India assurance, I used to pay Rs. 21,000 per annum they gave me insured value upto 70 to 75%. I got bumper to bumper zero depreciation it has the cash garages. There is no claim experience so far, the renewal process is very easy through online.
    Was this review helpful? 0
    , sonipat
    Reviewed on Sep 19, 2019
  • ICICI Lombard Car Insurance
    "Good"
    0.5 5.0/5 "Blown Away!"
    I have chosen ICICI Lombard for a car insurance because am holding a salary account and the services are good. I got a first party insurance. I am having Maruti Suzuki Zen which is 8 years old. The IDV value is better. The policy is valid for one year and paid premium of Rs.2,500.
    Was this review helpful? 0
    , visakhapatnam
    Reviewed on Sep 17, 2019
  • SBI General Car Insurance
    "Good"
    0.5 4.0/5 "Great!"
    My car is insured with SBI General because its easy to renewal and main thing is the premium is not so high. The customer service is not so good and would suggest them to improve the service. I had a claim and the experience was average. The policy is valid upto 3 years.
    Was this review helpful? 0
    , faridabad
    Reviewed on Sep 17, 2019
  • Oriental Insurance Car Insurance
    "Good for car protection"
    0.5 5.0/5 "Blown Away!"
    I have maruthi 800 car which has the four wheeler policy of Oriental Insurance, my premium was around Rs. 8.000 for specific period. I took bumper to bumper with 100% of coverage, the renewal process is very easy. I usually visit to the Oriental branch, I used to get the policy copy. They do have road side assistance, 24 hours service etc.
    Was this review helpful? 0
    , bangalore
    Reviewed on Sep 14, 2019
  • Chola Ms Car Insurance
    "No claim Experience"
    0.5 3.0/5 "Satisfactory"
    I have taken car insurance from Cholamandalam insurance. They have financed for my vehicle hence they have provided the policy from them. Long back, i have renewing the policy with the same company. They have provided me a coverage value of Rs. 2,5 lakhs and i do not have any claim experience till now.
    Was this review helpful? 0
    , hyderabad
    Reviewed on Sep 14, 2019
  • National Insurance Car Insurance
    "Good Experience"
    0.5 5.0/5 "Blown Away!"
    In 2016, I had a car insurance with National Insurance, at the time I done a claim because my car front bumper got damaged, hence I got the cashless garage option then within 2 to 3 days I got my car back with proper condition, it was also good insurance company.
    Was this review helpful? 0
    , panipat
    Reviewed on Sep 13, 2019
  • HDFC Ergo Car Insurance
    "Good Protection "
    0.5 5.0/5 "Blown Away!"
    Currently I have car insurance with HDFC Ergo, I paid the premium around Rs. 10,000 for one year plan, it gives bumper to bumper protection for my 2015 maruthi wagon R car, they are providing good IDV value based on manufacturing year. The renewal process was happened easily through the dealer.
    Was this review helpful? 0
    , panipat
    Reviewed on Sep 13, 2019
  • ICICI Lombard Car Insurance
    "Good for car policy"
    0.5 4.0/5 "Great!"
    I have four wheeler policy with ICICI Lombard, the premium is based on the claim or else its reliable. They do have third party insurance, road side assistance, 24 hours, I got the cashless claim when I met with an accident but they covered 50% of plastic only remaining amount I paid it.
    Was this review helpful? 0
    , gurgaon
    Reviewed on Sep 10, 2019
  • United India Car Insurance
    "Good Policy"
    0.5 4.0/5 "Great!"
    United India renewal process is very easy and they give reminder call before the due date. I paid Rs.7800 for per annum for my bumper to bumper plan, they are providing road side assistance, 24 hours. They do have no claim bonus for my renewal. The service is prompt I able to reach them at any time.
    Was this review helpful? 0
    , coimbatore
    Reviewed on Sep 09, 2019
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