People usually file a claim assuming they have a comprehensive motor policy but end up frustrated with the whole claim settlement experience. Customers start to question the utility of an insurance policy when they have to go through the mental trauma of claim processing. In this article, we tell you 5 key things you need to consider while making a motor claim.



1. Should you make a claim?

Insurance companies reward you for driving safely by offering what is called a ‘No Claim Bonus’. A no-claim bonus is a fixed percentage deduction on your premium based on the age of your car, assuming you have not filed a claim since you purchased your car. The moment you file a claim, your ‘No Claim Bonus’ will become zero, not just for the immediate renewal year but also for every subsequent year. This means that you will have to pay higher premiums for a lifetime of your car.

Here is your first important insight - You should only make a claim if the car damage is extensive & justifies the higher future premiums.


2. How much are you supposed to pay out-of-pocket?

This is extremely important to figure out before you start with the claim process. Usually, a customer needs to pay out-of-pocket for 3 things:

  • Depreciated value of damaged components. Remember: under standard coverage, your insurer only pays for the non-depreciated value of damaged component.
  • Deductible, if there is one. Deductibles help you reduce premium but increase your liability during a claim.
  • Excess - a small sum you have to pay whenever there is a claim to cover for administrative costs

So your real choice is NOT between total repair cost V/s future NCB loss

First find out what you need to pay for repairs as out-of-pocket and then do your analysis as per Point 1 mentioned above. If it still makes financial sense, go for claim initiation.


3. Collect evidence of damage incurred and inform your insurer immediately

It is important that you have concrete evidence that shows the nature and extent of damage to your car. One of the best ways of doing this is to record images on your mobile phone from multiple angles. Make sure that you also make some notes of your own on the damages incurred (the ones you can identify- need not be comprehensive). If it’s an accident, make it a point to note the registration number of other vehicle (if there is one) and any contact details of any witnesses onsite at that time. This will significantly improve your chances of prompt settlement of claims.

Once you get yourself to safety, identify a helpline number for your insurance company and inform them immediately. In your call with insurance company, explain the incident accurately and also mention the damages that you can identify. We recommend that you follow-up this call with an email so that it gets recorded as evidence. If there is a third-party liability involved, please make sure you get a ‘FIR’ registered at a nearest police station.


4. Look for cash-less service centers for your insurance

Most insurance companies have a network of preferred service centers where claims are cashless and customers find it a lot easier to deal with their claim settlement. Although you are free to get repairs done at any other center, you must remember that this transaction will not be cashless. You have to first pay your service center, collect all bills & warranty cards of parts replaced and submit them to insurance company. Only after this step is done will your insurer reimburse your expenses in 2-3 weeks. It is extremely important that you ask your service center to handover old parts that were replaced & bills of new parts that were put in.

While it is not always possible to find out a nearest service-center that is tied to your insurance company, it is important that you research this information. You can instantly search for cashless centers nearest to your current location on by just mentioning your insurance company and pin-code.


5. Keep your insurer in the loop before making repairs

This is a tricky issue – always, always report to insurance company before asking your service center to initiate repairs. Here you need to be careful because car service centers usually suggest that they can convince on-site surveyor to get your claim settled. Don’t buy that argument & insist on first getting all clearances on nature of repairs from insurance company.

Also, never stack up unrelated damages to your car and make it part of your claim with insurance company – there are a few service centers that advise you to do this but understand that you will be exposed to risks of losing your coverage completely. Even if on-site surveyor approves such changes, you might be asked for further evidence to prove your claims. If evidence of damage is not satisfactory, insurance company will have a right to refuse paying for your claims.

Remember - get a quote from your car service center and run it through your insurance company if you want to save yourself from unwanted surprises.