Having car insurance, you may think you will be able to make an insurance claim if anything untoward happens to your car. However, there are reasons or situations where your car insurance claim might get rejected.
For your awareness, we share in this article a few reasons why your insurance claim might get rejected and situations not covered by your insurance.
Reasons why your car insurance might get rejected
No or delayed police report
If you do not make or delay making a police report, your insurance might reject your claim.
Please immediately go to the nearest police station to lodge a report if you run into an accident. Do not take this matter lightly as you will need to attach a police report to your claim form.
Your insurer may reject your claim if you fail to submit a police report or if the report is made 24 hours after the accident. For an easier claim process, ensure that you lodge a police report as soon as possible.
Depending on your insurance policy, your insurance coverage is limited to you as the policyholder and the third party if you are at fault. Imagine that you let someone unnamed in your policy drive your car. You will have to pay a compulsory excess of RM400, if the driver runs into an accident. Worse, there is also a possibility that your insurer might reject your claim.
To avoid a compulsory excess and claim rejection, consider all drivers coverage. This add-on coverage will protect anyone authorised to drive your car.
Providing inaccurate information to your insurer might also cause claim rejection.
When you buy car insurance, you will have to provide personal and vehicle particulars. These include your marital status, employment and vehicle safety features. Some insurers may even require information about the type of your parking garage. This is because an unsecured and open parking garage will expose your car to a higher risk of theft. If you declare that your stolen car is parked in a guarded area when you actually park it in an open and unsecured area, your insurer might reject your claim.
Therefore, please be honest when providing the required information. Failing to provide the correct information may just result in a claim rejection.
Driving under the influence of alcohol or drugs
If you run into an accident while driving under the influence of alcohol or drugs, your insurance would reject your claim. In fact, under Section 45A(1) of the Act, those guilty of driving under the influence of alcohol or drugs face a jail term of not more than two years, a fine ranging from RM10,000 to RM30,000 and revocation of driving licence for two years or more.
Situations not covered by insurance
Note that your car insurance will only cover what is stipulated in your insurance policy. This is why you need to understand each type of car insurance policy and its coverage.
For instance, if your purchase third party insurance, your insurance will only cover the loss or damage to the third party’s property. On the other hand, if your purchase comprehensive insurance, your insurance will also cover the damage and loss to you and your car.
Consider that you purchase third party insurance. As luck would have it, you run into an accident where you are at fault. Unfortunately, you cannot make an insurance claim. Hence, you will need to pay for the repair cost out of your own pocket.
There are also other situations your car insurance will not cover which we will explain in the following points.
Situations that your car insurance will not cover
Most standard car insurance policies come with exclusions. These are certain losses that your insurance will not cover. Let’s look at some of the common exclusions of car insurance policies.
Injury or death
Say that a car accident leaves you permanently disabled, you are not eligible to claim for your disability. This is as most standard motor insurance does not provide personal accident coverage.
However, if a third party causes the accident, you will get compensation from the third party’s insurance.
For greater protection, consider adding personal accident coverage to your comprehensive insurance.
Total loss (for third party, fire and theft insurance & third party insurance)
As mentioned, third party insurance will only cover the loss or damage to the third party and their property. If you purchase third party, fire and theft insurance, your insurance will also cover your car in the event of fire or theft. Say that you own either insurance, you will not get any compensation if your car is a total loss.
However, if you purchase comprehensive insurance, your insurer will provide compensation to you based on either the market value or the agreed value of your car.
Most standard car insurance including comprehensive insurance does not cover your car for damages caused by natural disasters. These may include floods, typhoons, hurricanes, storms, tempests, volcanic eruptions, earthquakes, landslides and landslips.
Imagine that your car is submerged in floodwater. You will have to bear the repair cost for your damaged car.
Fortunately, you can extend your insurance coverage by getting special perils cover. This will cover the repair cost or compensate you for damages due to any of the natural disasters.
Additional car accessories
Your insurance will also not cover additional and non-standard car accessories. Your insurance only covers the standard, factory-fitted accessories.
To protect your additional car accessories, you may consider adding car accessories cover to your comprehensive insurance policy.
Your insurance policy will also not cover any damage to your car due to strikes or riots. However, you may purchase Strikes, Riot and Civil Commotion (S.R.C.C) add-on coverage. You will get compensation if your car is damaged by any of the situations.
Review car insurance policy before renewal
It is important that you are aware of the reasons and situations that might get your car insurance claim rejected. Before buying car insurance, ensure that you understand your insurance coverage and exclusions. You may also consider car insurance add-ons to get protection for situations that standard insurance does not cover.
If you need professional help before buying car insurance, you can always count on Bjak for unbiased insurance advice from our experts. Visit Bjak for more information or simply WhatsApp our experts for advice, anytime you need it. Start by getting your free car insurance quotes.