Whether you like it or not, insurance companies have the right to reject certain claims—and they happen more often than not. Sometimes, insurance providers deem that a policyholder’s file for claim is invalid, and will not honor any claims made by the latter. So how do insurance firms decide whether or not your claim is genuine. Here are some of the main reasons why insurance companies reject your claims.
Inadequate understanding of the policy
Your policy will include the keys things to know about motor insurance claim. While some people take the time to read all the clauses included in the policy, some of them just sign at the bottom of the page without understanding the terms included in the policy. If a policyholder does not understand the terms of claim written in the policy, he may not be able to defend his claim and have it rejected outright.
It may be tempting to add body kits, spoilers, and other aftermarket modifications to your car, but doing so may actually risk your chances of claims in the future. When you get into an accident and your insurance provider finds that you have installed modifications to your car, they may not include the mods to your claims or worse, may even totally reject your insurance claim. Before you start shopping for new rims and other car blings, communicate it first with your insurance provider to know if you are not violating any clauses included in your policy.
Damage due to negligence
As part of their diligent investigation before handing out claims to policyholders, insurance companies will send their agents to investigate the matter and find out if the claim is entirely legit. If the accident happened because of gross negligence on the policyholder’s side such as driving under the influence, breaking traffic rules, driving without license, and so much more, then the insurance company may just reject your claim.
The insured car’s condition needs to be consistent with the use intended in the policy. When you insure a vehicle, the company will ask you on how will you use your car (personal, commercial, sporting). If you used your vehicle other than the usage indicated in the policy, then you will definitely have problems with your claim.
In relation to the item above, another reason why insurance companies reject claims is when the insured vehicle is used to assist any criminal activity, which includes robbery, theft, kidnapping, and fraud. Aside from being an accessory to a crime, policyholders who intentionally damaged or dispose of their vehicle in hopes of getting a claim will face serious charges from the insurance company, as this corresponds to fraud.