Have you ever had a fight with your car insurance provider for not covering a loss? That usually happens when the insurance policy has not covered a particular loss and you never really gave that much of a thought when you were signing that insurance contract. Comprehensive car insurance covers still leave out quite a few clauses that you may have never considered as important. Once that happens, it means that during a loss, or an accident or theft, you may be left in the lurch by your insurance provider and you would have to bear the cost yourself!
So, when your policy is near expiry, or if you’ve started shopping around for a new car, go through the car insurance policy and make sure the following areas are always covered:
- Motor collision with any other vehicle (Government or Private Owned)
If you’ve gone through this clause, read it carefully again. It generally covers injuries and accidents where you and your car are covered. But if you ensure that the Third-Party Clause is added, then damages to someone else’s property can be covered too in case you accidentally bump into someone else’s vehicle.
- Fire and explosion due to mechanical or electrical fault
Besides collision or an accident, comprehensive insurance also covers damage to car in case of fire caused by mechanical or electrical fault. However, the coverage will seize to exist if the car is carrying explosive or flammable material. Rethink about carrying petrol or kerosene for your generator in your car.
- Natural calamity including earth quake, flood or lightening
Depending on the owner requirements, destruction of car by natural calamity such as flood, lightening or an earth quake can be included in insurance too. But not all insurance plans cover this clause. If your city or locality has issues related to any of this, make sure this clause is added to the policy. Heavy rains do not equate to floods. Make sure heavy rains are added to the policy or the car or bike that stopped recently during heavy rains this year, will not be paid for by insurance!
- Theft and or car snatching on gun point
This is an importance clause that must be added in the insurance plan because of law and order situation in our country. In case the car is stolen or snatched at gun point the insurance company is liable to settle the claim as per insurance policy agreement.
- Damage due to riot, strike or terrorism
This clause is not mandatory in the auto insurance plan. Most insurance companies will not cover this clause. If you remember the strikes and riots that used to happen a few years ago, a lot of insurance companies got away with not paying for the cars that were looted, or destroyed during these riots. Case in point for the clause not being present in the policy. So, make sure the next time your policy is up for renewal, this clause is added to it.
- Meeting an accident even when car is parked and the car is not driven
Your car could be bumped by somebody trying to take their car out, while your car is parked next to it. You can ensure that the insurance company pays by having the motor collision added to the insurance policy.
Now that we have understood what auto insurance policy may cover, lets also briefly discuss what area are not covered in the policy, and what are some of the clauses that you may want to have added to it:
- Personal belongings, such as laptops, briefcases, handbags, expensive sunglasses, etc. can be covered. Surprised, right? Ever heard of someone’s bag or expensive clothes getting stolen? They all can be covered if you haggle right with your insurance provider.
- If a car is chauffeur driven or is driven by any family member instead of the owner, that must be spelled out too while the policy is being drafted. If the car is driven by someone not holding a valid driving license, the insurance company may deny any claim, this will create a huge problem when “claim” is made.
- Auto insurance may not cover if the car is rented out for commercial use such as to Careem and Uber. For this, you may require a commercial insurance cover which must be negotiated with the insurance company before purchasing the auto insurance policy.
- If the policy lapses by even a single day the auto insurance policy will seize to exist and any claim will be denied by the insurance company. Make sure your payments are made on time.
- Any negligence on part of the owner such as; battery check up, engine, brakes, and differential oil change, air and oil filters not documented properly, all can lead to your claim being rejected. Your car needs to be in its top shape.
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