Do You Know Why Your Car Insurance Claim Gets Rejected?

Buying an ideal car insurance plan has its work cut out for you. From singling out a few providers you like to choosing your top 3-4 plans, comparing benefits, limits, taking notes from experts and then finally buying a plan, there is a lot to do. But your job does not end here. The kind of precision it requires to buy the perfect car insurance plan is also required when you finally submit a claim against that plan. Spotless paperwork, crystal clear claim terms and many other components are required to make sure that your claim doesn’t get rejected or denied. However, mistakes are often made even when you are being extra careful. Let’s examine some of the reasons for car insurance claims to get rejected or denied completely and what can you do to avoid these situations. 

Rejected vs Denied Claim

Rejected claims and denied claims are two terms that are often used interchangeably. However, they refer to two different kinds of situations in the claim cycle of an insurance plan. Rejected claims are often a result of errors in the claim form, documentation, etc. Once these errors are rectified, the claim can be submitted again and it will be processed if there are no administrative errors. So, rejected claims can be salvaged pretty easily if you take care of what you are putting down on the forms. 

Denied claims are the claims that have been processed completely by the insurance firm and have been categorised as something that can not be covered by the car insurance company. You can not submit these claims again to get them approved since the reason for denial is based on the coverage of the car insurance plan. Denied car insurance claims are absolute, however, can be challenged in the court of law if the policyholder finds the grounds of denial to be unfair. Whenever an insurance company denies your claim, they send you a well-written detailed reason for their decision. You can go through that and decided whether you are satisfied with the decision or you would like to challenge it. 

Top Reasons for Car Insurance Claims to Get Rejected 

There are a few small reasons for which car insurance claims can be rejected by your car insurance company. Given below are the ones that you can take care of even before you go out and submit the claim request:

Incomplete Paperwork: Claim initiation is done way before the actual paperwork begins. Your insurance company starts the claim process as soon as you notify them of the accident or theft for which you need to make a claim. However, the final claim is accepted by the company garages only when your completed documents come back from the insurance company–approved. If you miss out any of the important documents here, the insurance company will reject the claim and send you the whole set back.

Missing Important Information in the Forms: Apart from submitting the claim-related documents, you are also supposed to submit a duly filled claim form. Online submission will not be done before you complete the whole form. But you may miss out on important information if you are filling out the form by hand. Such car insurance claims with missing information on the claim form are also rejected by the initial screening department itself. 

Administrative Errors in the Claim Form: Spelling mistakes, filling the form in lower case when you were supposed to use upper case letters, wrong policy number, etc. are just some of the administrative errors that one can make on their car insurance claim forms. Yet again, these claims are rejected in the screening process. 

What Can You Do to Avoid Claim Rejection?

Rejected car insurance claims are fairly easy to handle. All you need to do is check the form properly for any spelling mistakes in the name of the policyholder and other important information or error in the policy number. Take a fresh form and fill it out if you are having trouble figuring errors out. Make sure the form is either filled in English or Arabic. Check the documents as well. You will need your passport, Emirates ID, residents visa page, car registration documents, car insurance contract (if asked by the provider), the police report of the accident/incident and the information related to the third-party driver and vehicle if any involved. Make sure you have all these things before you submit the claim form again. Since car insurance claims are only settled directly in the UAE, your car will wait in the garage while your claim gets approved and the car gets scanned for damages to be repaired. 

Know About How Can Car Loans Affect Your Car Insurance Plan?

Top Reasons for Car Insurance Claims to get Denied 

Denied car insurance claims are tricky. The process to reverse them is lengthy and may take up a lot of time and energy as well. Following are the reasons for which car insurance claims generally get denied by the providers:

Claimed Items That Are Not Covered by the Policy 

You were in an accident and the windshield and engine of the car get damaged. You submit a claims request for the repairs of the windshield and engine of your car. But as it turns out your car insurance plan neither offers windshield repair cover nor engine protection cover. In this case, since you have claimed items that are not covered by your policy, the claim will get denied. Whenever you submit a claim that includes items excluded from the car insurance plan, the claim gets denied. 

Unlawful Driving 

Your car insurance company is generally liable to pay for your vehicle repairs, injuries and third-party liability expenses if you caused the accident. But if you submit a claim request and the documents related to the accident as well as your medical reports show that you were driving unlawfully, the claim gets denied. Unlawful driving can include driving under the influence of drugs and alcohol, breaking traffic laws (not wearing a seatbelt, jumping traffic lights, etc.), being involved in unlawful activity, etc. 

Misinformation Supplied to the Insurance Company

When you inform your insurance company initially about the claim that you are about to submit for an accident, you are expected to present an honest account of the situation. If your insurance company finds that any of the crucial information supplied to them was incorrect, the claim gets denied instantly. 

Expired Car Insurance Policy 

You may not have realised but you may forget to renew your car insurance plan when the due date arrived for the premium and it expired. Submitting a car insurance claim to an expired car insurance plan is surely going to get denied, no matter what is covered by the plan. 

Related Article: How to Check Car Insurance Status Online for Your Policy?

Claims Including Car Modifications

Most car insurance companies do not offer insurance for modified cars. Some practical modifications are appreciated by insurance providers such as anti-theft devices. But even these modifications should be brought to your provider’s attention beforehand. If your car insurance company notices any new modifications at the time of the accident that were not pre-approved, your claim gets denied. Your contract generally states that any modified cars will not be covered by the insurance company for any kind of damage or loss. 

Commercial Work Done Using Personal Vehicle

Personal car insurance plans do not cover your vehicle repairs if gets damaged when you were using the car for commercial or business purposes. All private car insurance plans exclude business and commercial usage from their coverage plan unless specified by the provider separately. 

Unsanctioned New Driver 

Loaning your car to someone else can result in claim denial for you. Car insurance companies insist that only the owner-driver of the vehicle or the sanctioned additional drivers drive the car. If the car is damaged when an unapproved driver is driving and caused the accident, the insurance company may not cover for any damages or injuries whatsoever. If you submit a claim in such a situation, it may get denied.

Consequential Damages 

Sometimes when you take too much time to get your car repaired after a small accident, it leads to consequential damages. For example, if your engine got a little damaged and wasn’t repaired instantly, it will lead to further damages. These additional damages are categorised as consequential damages – consequences of the previously done damage which wasn’t repaired in due time. This applies to physical damages incurred by the vehicle as well. Insurance companies reject car insurance claims that include consequential damages. 

Claim Amount Exceeding the Assured Sum of the Policy 

If the total claim amount for your vehicle repair happens to be exceeding the policy assured sum, the insurance company has no choice but to deny the additional part of the claim. It does, however, cover the expenses that are under the assured sum limit of the plan. 

Value-Based Car Insurance Claims

Value claims for your car are different from policy-based claims. Value claims generally deal with luxury and vintage cars. These cars are insured based on the current market value rather than the market price. The owner of the car and the insurance provider meet and decide the assured value of the car. The value of your car may have increased since you got the insurance. Value claims can be tricky in such a situation. They may include a lot of negotiation and denials as well. 

The Final Thought 

The auto insurance claim process may seem a little tricky to get approved. However, if you have the right set of tools at your disposal, you can easily submit your car insurance claim and get it approved as well. Take care of the reasons for which your claims may get denied or rejected. Try not to make any errors on the claim form and do not miss out on the documents. Have a clear understanding of the policy as well as the terms of the plans to develop a good understanding of both inclusions and exclusions.