Reasons Your Car Insurance Claims May Be Denied

Reasons Your Car Insurance Claims May Be Denied

by 5paisa Research Team Last Updated: 2022-12-15T17:12:11+05:30

Auto insurance companies deny claims or reduce payment values in case of frauds or when insureds furnish any wrong information. A lot of people make such mistakes by being unaware of the grave consequences when the need arises. In such a situation, filing claims and receiving financial benefits could be a difficult task.

Some of the common reasons that may lead to rejection of your car insurance claims are:

Invalid License -

Either your license is fake, it has expired, or it is for a different vehicle category.

Wrong Usage Of Car -

You have a car insurance policy which states ‘for personal use’, but you use your car for commercial purposes. If you want to use the vehicle commercially, you should purchase a commercial car insurance policy.


Accident Under The Influence Of Alcohol -

An accident because of drink and drive offense (or any other intoxicant for that matter) may lead to rejection of insurance claims.


Failing To Intimate Insurer About A Theft/Accident Within Stipulated A Time -

In case of a theft or an accident, insureds are obliged to inform their insurance companies within 48-72 hours of the incident.


When Value Of Your Vehicle Depreciates -

Over time, the value of your vehicle depreciates. After few years, the value of your car tend to be lesser than the overall repair cost due to depreciation. In such a situation, your car insurance claim may be denied.


Policy Lapse -

Filing a claim for a lapsed policy would not help you in anyway and so it is necessary that you unfailingly pay your yearly premiums on or before the due date. Even if you are unbale to pay premiums on due dates, insurance companies provide a grace period to renew your insurance.

Conclusion -
Now that you know when your auto insurance claims may get rejected, why take the risk of getting less financial assistance or worst - not getting anything from your policy at all? Be honest and furnish every detail pertaining to the above factors to your insurer.

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