Just like every other insurance, your car insurance policy also comes with certain exclusions. Simply put, these are the conditions under which the damages to your car would not be covered by your insurer. As a car owner, it's essential to understand that even a comprehensive car insurance policy does not cover ‘everything’.
Exclusions: What's Not Covered?
Despite being quite comprehensive, there are certain circumstances under which you cannot raise a car insurance claim for damages or losses.
Regular Wear and Tear: The Everyday Ignored
Motor vehicles are bound to experience general wear and tear over time. You may notice that tyres may need replacement due to regular wear and tear, and brakes may also become loose, among other issues. Engine oil is also a component that needs to be changed regularly to maintain the vehicle's condition.
General depreciation resulting from regular wear and tear, rather than external factors, is not covered under a car insurance policy in India.
Note: If the tyre is damaged as a consequence of an accident, your insurance company may compensate for the loss, possibly up to a certain limit.
Mechanical & Electrical Failures
Electrical and mechanical failures of cars are not covered by car insurance. If your vehicle’s battery, gearbox, or other mechanical parts fail, such breakdowns are usually not covered under insurance. Damage to the clutch is also not covered. In some cases where the damage has been caused by the accident, certain damages may be covered.
Note: You may purchase an engine protection add-on for a comprehensive plan!
Driving Under the Wrong Influence
Any damage caused while driving under the influence of alcohol or drugs is not covered under car insurance plans.
Note: Illegal driving or being under the influence of intoxicants may also lead to legal actions!
Illegal Activities & Reckless Driving
Reckless driving or illegal racing are not covered under car insurance. In case your vehicle sustains damage due to stunt activities, racing, or speed testing, such conditions will not be covered in the car insurance plans.
Illegal Driving
Driving without a valid license remains a serious offence. It is crucial to always have a valid driving licence; otherwise, your car insurance claim will be denied. If an underage driver were driving your car, then your coverage would be denied.
You should also be aware that using private vehicles in India for commercial purposes is also not permitted. So, damages to the vehicle in such a situation are also not covered under car insurance.
Consequential Losses: The Hidden Exclusion
The purpose of a car insurance policy is to provide financial protection against damages caused by inevitable and unforeseen situations. However, if the damages are found to be consequential, the insurance claim may be rejected.
For instance, an engine hydrostatic lock may occur due to waterlogging. Since this can be avoided with preventive measures, it may be treated as a consequential loss and will not be covered.
Does your car usually stay in the garage for a long time? Read this blog to know how to protect your car in storage.
War, Nuclear Risks
In the event of riots or wars, damages to the vehicles are not covered. This is because these are man-made disasters. Only damages due to natural calamities are covered by car insurance plans.
Personal Belongings Inside the Car
In the event that an insured car is stolen, compensation is not provided for the personal belongings inside the car. People may have their laptops, cash, phone, or expensive belongings in the car. So, if your car is stolen, the policy does not cover the loss of belongings kept inside.
Note: You can add coverage for personal belongings in the car with an additional rider.
Policy Lapses
If you raise a claim when the policy has expired, the claim will be rejected. Car owners can only raise an insurance claim when the policy is active. Therefore, it is crucial to renew the policy before it expires.
The Fine Print Matters
Car insurance exclusions are essential as they help balance the risk and prevent possible misuse of the policy. It also ensures the car insurance premiums are as affordable as possible.
Reading policy documents might seem boring and time-consuming; however, it is extremely important. As a car owner, you need to have a detailed understanding of your car insurance policy so that you can maximise its benefits.
‘What damage does car insurance not cover?’ This segment is carefully listed in the policy documents. So, even if it takes time, try not to skip it. In case you have any confusion, you can always ask your insurer for a detailed explanation. Some people may misunderstand that everything is covered by standard car insurance. This is why it is essential to review the policy documents.
Add-Ons That Can Help You Bridge the Gap
While a standard car insurance plan may not cover certain conditions, you also have the option to add additional coverage. To bridge the gap in your policy coverage, you can purchase required add-ons.
Some of the popular add-ons by Generali Central are:
Zero Depreciation
As discussed in the above sections, general wear and tear of a car is not covered under the car insurance policy. This means the depreciation cost is deducted from the overall claim amount. However, with a zero depreciation cover, you can waive off this cost deduction.
A zero depreciation add-on cover means the depreciation value of your vehicle is not deducted. You receive the maximum permissible compensation for the damages and losses.
Roadside Assistance
You are en route via highway for an important meeting, and suddenly your car stops in the middle of the road due to a technical issue. In this situation, you may not be able to find a mechanic nearby. Help from friends or relatives may also take some time.
This is when the roadside assistance add-on cover acts as a saviour. All you need to do is inform your insurer, and help will arrive promptly. With a roadside assistance cover, you no longer have to fear long drives, especially on roads with fewer mechanic options.
Consumables Cover
The cost of consumables, such as engine oil and brake oil, is not covered under car insurance. To cover these expenses, you can purchase a consumables cover. At an affordable premium, you can get a wide range of coverage for consumables.
Engine Protection
Oil leakage or water ingress can sometimes damage your car's engine. It can be quite expensive to repair. However, with an engine protection add-on cover, you can get the cost covered by your insurance company.
Conclusion
Exclusions are an essential component of a car insurance policy. Conditions such as general wear and tear, consequential losses, and damage due to war and riots are typically not covered under car insurance. Therefore, carefully reading the policy documents and consulting with your insurer is crucial before you buy car insurance online or from a nearby office. Not only does it help you make an informed decision, but it also allows you to decide on the add-ons required for comprehensive plans.
