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Reasons why your car insurance claim
may be rejected
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You have insured your
car, then it is maybe stolen or damaged, you place a claim which is then
rejected. I have compiled some of the
reasons why car insurance companies may reject a claim.
It
is disturbing when your vehicle is damaged and even more painful when your
insurer refuses to compensate you because your policy doesn’t cover for what
caused the damage. This is so because Insurance protects people against
unexpected events and that are stated in the policy.
However,
circumstances do happen when an insurer refuses to settle a claim because of an
omission or breach of policy condition. Even when insurance protects you even
from a loss that may have been caused by your own negligence, it will however
not cover for gross negligence. For example, when the insurer can confirm that
you deliberately ignored a situation knowing very well that a loss was likely
or probable.
Reasons
why your insurance claim may be rejected
Driving
under the influence of alcohol or drugs – Motor insurers will not agree to pay
out if the loss occurred when you were driving under the influence of alcohol
or been tested positive for misusing drugs. Some insurers further reject a
claim if the person you lend your car to was under the influence even if you
had no idea.
Suspended
or cancelled license – Your insurer will
not compensate you if they find out that you do not have a valid driver’s
license at the time of the accident. Insurers will consider this as you
contravening the law and insurance does not cover for any illegal activity.
Some insurers will go further and reject a claim if a person you lend your car
to is unlicensed even if you didn’t know it.
Allowing
a friend to drive a vehicle –
If you allow a friend or anybody to drive your car without informing your
insurer, you may end up footing the bill for an accident. This is because some insurance
providers restrict driving to nominated drivers.
You
MUST report accidents
Failing
to report an accident to the traffic police within 24 hours after you are
involved in an accident or if your car has been stolen may lead to your claim
being rejected.
Not
taking your car for inspection, or if you are insuring a newly acquired or used
car or have decided to change insurance companies you need to take your car for
inspection. They need to see that your vehicle exists and is not damaged.
Failure do this, your claim may be rejected.
Failing
to install security devices on your car may lead to claims rejection but this
is limited to some and not all insurers. Some insurers will not compensate your
loss if you haven’t installed the standard security devices in your vehicle
that they require, like an alarm and immobilizer or a tracking and recovery
system.
Car
modifications can lead to claim rejections
Car
modifications: You may be required to inform your insurer whenever you modify
your car to change its performance. Insurers need to know for example, when you
have modified the engine because this may affect the rate that is charged. If
you have for example installed a new sound system, mags or other accessories,
these may not be covered unless you advise first.
Driving
across borders: Some insurance providers may not cover for loses occurring when
you drive beyond the territorial limits stipulated in your policy. Most
insurers will only cover you within the Kenyan boarders and within the
immediate surrounding countries. If you plan to drive out of the territorial
limits of your policy you need to have cover extended for where you are going.
Using
a vehicle for business purposes: Confirm with the “use description” that apply
to your vehicle carefully because insurers differ in their user descriptions
and you may not have the cover that you think.
For
instance Private Use may include driving to and from work and attending to the infrequent
meetings but some wordings do not. The idea here is that you need to be able to
get a sense of how far the vehicle will be driven.
Read
the fine print when you take out car insurance
The
above list is by no means comprehensive – it is very important to read and
understand the small print on your insurance policy. Once you have read and
understood the policy and you are still not happy about your insurer’s decision
not to settle your claim. Wait until you get a policy with terms you side with.