The current deluge in Odisha has caused damage to hundreds and thousands of people along with their homes and vehicles. In such times, people turn to their insurers for financial help, especially those who have taken home and motor insurance policies. But most often, even after having an insurance policy, claims are rejected by insurers. This, however, is mostly because of the lack of awareness about what is and what is not included in a policy.
From time to time the government has also been taking measures to make people aware of these things and push insurance. The Insurance Regulatory and Development Authority of India (Irdai), in the aftermath of the Kerala floods, had provided guidelines and had asked insurance companies to simplify the claim-settlement procedures, to make it more convenient for policyholders.
Experts suggest consumers should make themselves aware of the terms and conditions of their insurance policy. For instance, typically property claims get rejected due to non-disclosure, misrepresentation, and fraudulent acts. Claims also get rejected due to damage caused because of negligence or any wilful act. Experts suggest that policyholders should evaluate and familiarise themselves with their home insurance policy, the exclusions and the risks covered so that it doesn’t come as a shock later.
If due to flood, theft, or fire, there is damage to policyholder’s property, they need to inform the relevant authorities of the insurance company. For a smooth claim process, policyholders also need to provide all the supporting documents. The claim process starts with the insurer first appointing a surveyor to assess the damage of the property. Industry experts suggest it should be seen that policyholders have taken all possible measures to avert any further damage to the property. They should not act like the property is insured, and let the damage escalate.
In case of property, take photos of the accident or the damaged place. Also, try to keep the loss site untouched till the surveyors have assessed the damage. You should make an assessment of the loss and present it to the surveyors who come for an inspection. Experts say policyholders should not exaggerate the loss for their own profit.
The fine prints in an insurance policy hold critical information. The basic motor insurance policy, for instance, covers for losses caused by natural calamities such as cyclones, lightning, earthquakes, landslide, floods, hurricanes, storms, typhoons, and inundation. Insurers cover losses caused by the impact of these events, normal breakdown or regular wear and tear are not covered.
The hydrostatic lock of the engine is another situation which is generally overlooked but is not covered by a basic motor insurance policy. This means due to waterlogging, the car engine stops working. A policyholder should avoid trying to ignite the engine or cranking if the car gets stuck in a waterlogged area. Insurance providers consider engine seizure due to waterlogging as negligence on the part of the policyholder, and hence, reject claims. To additionally get this part covered under an insurance policy, you can opt for a separate engine-protect add-on cover.
Claims also get rejected if the application for a claim is not made within the stipulated time. Most insurers give a week to a month’s time, after which any claim filed is not considered.