For the worst of accidents or the tiniest of bumps, every car owner has one thing splashing in their minds and that is “Insurance”!! This gives a sense of security in times of need undoubtedly. However, it is a fact that you should not rely on insurance all the times. Although, it is not a fixed statement or an insurance rule, but it is globally suggested by insurance experts to follow the right norms of insurance to get the best benefit when you need it the most. There are two prominent scenarios where experts say, “don’t claim car insurance in these two situations.” Let’s find out which are those scenarios.
1.When NCB (No Claim Bonus) is higher than the repair cost:
The first and most important scenario in which experts advise that don’s claim car insurance is when your NCB is higher that the repair cost. It is an obvious fact that you can have a whopping discount on your premium if you have not raised any claims in the previous year. This discount is nothing but No Claim Bonus (NCB) and it can be up to 50%. The idea is that your car’s repair cost after a mishap should not cross the NCB. In fact, your car insurance premium comprises of two fundamental divisions such as
- Own damage premium
- Third party premium
Let’s go through a finest example to understand this scenario. If a person has a car and he/she has paid a premium if Rs.5,000. Out of this premium, Rs.4000 that is 80% of the premium is the own damage premium. In the consecutive year, the no claim bonus should be 20% of own damage premium which amounts to Rs. 800. Now, this NCB has to be less than the total expenditure incurred towards the repair of damaged car and that is when the claim is going to be fruitful. If the NCB is higher than the damage estimate given by an authorized repair shop, it is better that don’t claim car insurance and pay the charges from your pocket to avail a higher discount as no claim bonus.
To make it more precise, the discount is applicable on own damage premium and is of 80% of the entire car insurance premium and thus the NCB looks affordable even after ignoring the third party premium part. If the repair charges in the estimate issued by an authorized repair center exceeds Rs.800, the insured can go for a claim and if the charges are below, it is suggested not to file a claim. This is the first situation where you should not claim car insurance.
2. When third party is responsible to pay your car’s repair expenses:
It need not be our fault on the road all the time to meet a mishap. It can be the opposite person’s fault too. There are times when the opposite person pays your hospital bills and repair charges but undoubtedly, it is a blow in spite of all the payment relaxations. However, the bills are little relaxing. But situations have to offer different things in realty. The opposite person may not be warm enough all the time. Third party insurance claim helps in such situations. Especially, if your car is in fourth or fifth consecutive year without a claim ever made and your chances of getting a huge discount on premium is relatively high, and you end up getting hit by a co-passenger with no mistake of yours, third party insurance claim helps you. The probable options from such situation are:
- Pay your own expenditure for the damage
- Filing an insurance claim
- Filing a third party insurance claim
However, it is not always simple to get your third party insurance claim processed as it is an elongated procedure. It is because, you cannot file a claim with the insurer but with the Motor Accident Claims Tribunal as civil courts are not the deciding authorities on motor insurance claims.
- Lodge a complaint with local police station with a FIR
- Get a charge sheet copy
- Get reasonable evidences to prove that you are not at fault
- Collect the payment receipts towards vehicle repairs
- File a claim for approval
Although the processing is little time taking, this can be considered as a promising claim. After the submission of all the above said documents, chances are less likely that your third party claim gets rejected unless there is a strong reason. The third party insurance will not let you lose the no claim bonus too. If you don’t claim insurance in these two situations, you may not lose on discount on your premium as the insurance companies verify your claim history to understand how expensive your car insurance policy to them is. The more claims you file, the riskier it is for them to consider you. Filing frequent claims make your premiums expensive and hence it is important to understand when it is apt to file a claim and when it is not!!