Make sure you start the claim settlement process as soon as possible. Although a delay will not result in a refusal of claims, it will take that much longer to get the claim settled. “With the new IRDAI (Insurance Regulatory and Development Authority of India) circular, insurers cannot reject the claim because of delay of submission of documents. Though for smooth experience, try to submit the documents within 7-10 days,” informs Animesh Das, Head of Product Strategy, ACKO General Insurance.
In addition to certain dos and don’ts while filing your motor insurance claim, it is important to consider few things when it comes to filling the claim form, filing it, and settling the final claim with the insurance company.
Visit to the garage
It is advisable to call your insurer first and then take your car to the nearest network garage for settlement. The form is available with the authorised dealer or garage or one can download it from the insurance company’s website. “Also, obtain a document proof from the garage that you have sent the car for repair along with the fair estimate of the expenses to gauge that the amount will be covered in your insurance policy,” explains Tarun Mathur, Chief Business Officer, General Insurance, Policybazaar.com.
Filing up the claim form
Mention all details related to your car damage. Also, mention the details of the bills incurred for the repair of the car. There could be medical bills also. “If your claim includes medical expenses from injuries from the accident, you may be asked to sign a waiver to grant permission to your car insurance company to access your medical records,” says Mathur.
Watch-outs before signing final settlement
The actual claim amount that you are expecting may be different from what the insurer agrees to pay up. “Make sure that the final amount is as per the policy benefits which you have paid for. Few insurers deduct salvage cost, you should avoid such deductions. Also, insurers apply their standard rates of repair, and not the actual garage cost, thus increasing your share of loss, this should be avoided. Make sure to ask the insurance company’s representative to explain every line item of the claim sheet. Keep a record of it with you for future reference,” cautions Das.
IRDAI, as the regulator of the insurance industry, often hauls up insurance companies by sending them show cause notices for not adhering to the laws and provisions and then follow up with its own Order. This can be accessed on IRDAI’s website.
In such instances, this is what the insurer’s typical response in writing to the regulator is- “Many claims were negotiated, discussed with the claimants. The discharge voucher signifies the consent of the claimant. Negotiation of the claim was due to the errors and omissions of the customers. Instead of rejecting the entire claim for violation of terms and conditions of the policy, the claim was negotiated with the claimant and consent was obtained for the reduction in the claim amount. This was done with an intention to help the customer.”
And this is how the regulator’s observation to the above charge has been (there have instances where IRDAI has had to penalise the insurer) – “I do not agree that merely obtaining a consent letter from the claimants would indicate that the IDV (insured declared value) was mutually negotiated and discussed, leaving aside the legality of such negotiation and discussion to reduce the IDV on grounds not on record. The recording in the claim note is that by negotiation, certain amount has been saved. This only goes to show the intent of the company to save money rather than settling the claim on merits.”
IRDAI has been strict in such cases and goes on to add, “Also, there is no transparency about what can constitute a non-standard claim and the amounts deducted from the IDV in various cases seem to have been made arbitrarily. Further, relevant guidelines have been violated to the extent of having been non-transparent regarding deductions made from the claims.”
Getting a legal notice
At times, when the accident involves a third-party and you have received a legal notice for settling claims, you need to be careful. “Go through it properly and send it to your insurer and discuss in detail before signing the document. If you have an attorney, then consult him or her before signing the documents related to your claim settlement,” suggests Mathur.
What you should do
The insurer’s objective will be to make you sign on the dotted line without any objections to the amount of claim. Here is a word of caution: “While insurance companies must treat you fairly, keep in mind that they profit by collecting premiums and minimising claim payments. A quick and inexpensive settlement is ideal for the insurance company, so be wary of accepting the initial offer,” says Rakesh Goyal, Director of Probus Insurance.