There can be times when people can find it difficult to understand why their insurance claim has been rejected. If you don’t want to be in a similar situation, here are some of the lesser known reasons that will help you to file your claim successfully.
Here we have summarized the five main reasons behind the rejection of car insurance claim by car insurance providers:
Let’s explore these points in details so that you can avoid these pitfalls at the time of filing your next insurance claim.
Before filing the claim, you need to know what kind of events you are insured against. If you do not know this, you may be misled into thinking that a particular event is insured under your vehicle-insurance when in fact it is not.
In case your automobile is damaged due to the uncovered event, the insurance provider will reject your car claim.
In a majority of cases, the vehicle is insured against natural disasters. That being said, the insurance provider specifies the covered natural disasters in the policy document.
Similarly, if your automobile is insured against accidents, the insurer will only accept the claims resulting due to traffic-related accident. Accident due to any other reason will not be considered.
As a part of the agreement between you and your insurance provider, you are obligated to disclose all relevant information at the time of buying or renewing an insurance policy as well as filing the claim. If the insurance provider finds out that you have provided incorrect information or withheld important information, the insurer will reject your claim.
While your insurance claim gets rejected, it affects your credibility when it comes to buying a fresh insurance or renewing your insurance.
Some of the common non-disclosure scenarios are as follows:
If you are unsure of when you are expected to disclose information, we have listed some situations wherein you are expected to provide the accurate information to your car insurance provider.
Note - Not sharing information because you were not asked about it is also a case of non-disclosure, which can result in your claim rejection.
All the insurance policies come with a set of exclusions. Here is an example of automobile insurance exclusion:
If your car is insured against theft but you left your car unlocked in a secluded location, the insurer will reject the theft claim because the theft was caused due to your negligence.
It’s advised to thoroughly understand your automobile insurance policy in order to know about the events that are included as well as excluded. Most insurance policies come with exclusions on the basis of the insurance premium that a policy attracts.
Some common examples of exclusions with respect to automobile insurance are:
If you deceive the insurer or act in any manner that could lead the insurer to be deceived by your actions, it will be considered as fraudulence. This will adversely affect the chances of your insurance claim to be accepted.
In any case of fraudulence, the insurer will establish that you consciously intended to deceive the insurer and if it is successful in doing so, it can involve the local police authorities and charge you with criminal offences.
Although, there are exceptions when it comes to the insurer rejecting your claim based on fraudulence. The insurer cannot reject the insurance claim for a minor fraud or fraudulent activity that was not a result of the active participation of the automobile owner.
Before processing the claim, insurance companies make sure that the claim fulfils all the applicable terms and conditions. In order to avoid any claim related fraudulence, cross-check the information you provide to the insurance provider be and make sure you have evidence such as photos or witnesses for your claim.
If you feel that the insurer is investigating you for fraudulence and you didn’t try to deceive the insurer, you can seek legal help from a lawyer to protect your rights.
Since the insurance policy is offered by the insurance provider, it has exclusive right to make changes to the policy. Insurance providers include subtexts in the insurance policy terms and conditions that give them the privilege to alter, modify or cancel the insurance policy at their discretion by stating valid reasons.
The insurance provider can choose to discontinue the insurance policy as a precautionary measure to avoid risk.
Here are the reasons why policies get cancelled:
Such are the reasons that can be responsible for the rejection of your insurance claim. You can read your policy document or get in touch with your insurance provider to understand the claim process and documents required at the time of filing the claim.
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