There is an undeniable fact that every car owner must not neglect. The fact is; if you fail to identify the car insurance claims traps, then you are at risk of being taken advantage of in the future. Besides getting trapped by rigid insurance policies, you may also end up endangering your and other’s lives.
Auto insurance is necessary not only in UAE, UK, and the US but, also in other countries too. Insurance is compulsory for every vehicle owner to protect them financially when behind the wheel. So, whether you are getting basic liability insurance or full auto coverage, you need to get the best deal possible.
As nature implies, accidents can happen to anyone at any time. Have you experienced any incidents in the last three years? Yes? Then, don’t be surprised, if your car insurance policy costs more the following year after a non-fault bump.
But, what kind of car insurance claim traps would be?
Don’t worry, we have listed the common vehicle insurance traps in 2021, and also how to avoid them. Here you will find information about claim traps and possible situations that may arise during the claims process. On top of that, you make many mistakes that will cause you difficulty later.
Failure To Notify Your Insurer About Accident Immediately
The most common mistake people make is not contacting their insurer right away when they are involved in an accident or lose something. I will suggest you, don’t delay it! Call your insurer as soon as possible. This is necessary because of two reasons:
- Firstly, claims are easier to adjust if the events have just occurred and the evidence is fresh. As time passes, the evidence and witness memories fade.
- Secondly, timely notice is a requirement in most auto insurance policies. A majority of general liability and umbrella policies require you to notify the insurer as soon as possible during an occurrence, offense, claim, or suit.
- In the event you fail to notify your insurer of a loss or claim within a reasonable time frame, they may refuse to payout.
You also can report a loss or claim to your insurance agent or broker. In the end, the latter will send your insurer the relevant information. Hence, your agent or broker will get the claim forms and assist you in completing them.
Poor Insurance Policy Documentation
The failure to keep clear records on your part might take longer for you to recover from a claim. So, ensure that you document every communication with your insurer regarding your claim.
- Keep a record of the time, date, and content of every verbal conversation. And, Maintain a separate file of all documents so they are easy to access.
- Make a copy of all the documents that you mail to your insurer. Remember to keep track of the date when the documents were mailed.
- In case you speak with a claims representative or other insurance company representative on the telephone, send that person a summary of the conversation in email.
Whenever a loss or accident occurs, take a photo of the scene if you can safely do so. Take photos of your damaged car and send them to your insurer when filing the claim. Thus, photos can help verify the details of the incident and the damage to the vehicle.
Consequences To Not Comply With Your Insurer
Uncooperative behavior on your part may also delay your insurer’s payment.
- You must cooperate with your insurer so that your claim can be settled efficiently and effectively. When you do not comply with the insurer’s request for information about your claim, your actions could result in the insurer denying you coverage.
- Some insurance policies include written instructions on how to proceed when an accident and loss occurs. Therefore, always keep this instruction in your policy so you can review it before filing a claim.
Moreover, you also must be familiar with loss conditions in your policy. According to the contract, these are the conditions that you must meet to receive payment for a claim or loss. Consequently, many policies require that you cooperate with the insurer during the claim investigation and settlement process.
Not Contacting The Police Right Away
In some cases, failing to call the police may violate the terms of your insurance policy. Mostly, car insurance companies force you to call the police if a law has been broken.
- According to the standard Business Auto Policy, if a covered auto or its equipment is stolen, you must notify the police.
- Even if your insurance policy does not require you to do so following an auto accident, you should contact the police.
- State laws may obligate you to contact the police if anyone has been injured or killed, or if the accident has caused substantial damage to your vehicle.
- Obtaining a police report is advantageous for both you and your insurer, as it verifies the facts surrounding the accident or loss. In this way, the report can speed up the settlement of your claim.
Out-of-pocket Payments For Third Party Claim
If an accident occurs in which the third party endures minor injury or car damage, you might be tempted to pay the bills from your pocket rather than file an insurance claim. But, this is a wrong idea due to several reasons:
- Firstly, injuries that don’t seem serious at the time of the accident might later become worse. In the same way, some of the injuries may not be apparent right away. Additionally, the person whose vehicle you damage in an auto collision may develop whiplash after some days of the accident.
- Secondly, your liability and auto policies prohibit you from paying, taking on any obligations, or incurring any expenses without your insurer’s consent.
Therefore, it would be better to think twice before making payments by yourselves for injuries to people who have been affected by an accident.
Note: Injuries that look small at first can become large ones and they can generate a lawsuit against you.
Not Recalculating Your Insurer’s Calculations
Most of the auto damage claims that occurred in accidents are settled by the insurer’s calculation based on the value of the damaged vehicle. Normally, damaged cars are valued on their actual cash value (ACV).
Now, it doesn’t matter what your damaged vehicle is valued at, you should get realistic estimates for its repair or replacement.
- Never believe that your insurer’s cost estimation is accurate. As repair and replacement price of the vehicle varies from place to place.
- If it’s difficult for you to check the value of your car, then simply hire a public adjuster that will assist you.
- An experienced public adjuster will calculate the repair and replacement cost of your vehicle and later guide you through the claim process.
If you follow these steps, you can make up to reach your destination safely. Moreover, you can avoid catching up in the trouble from the very start. Always be careful throughout the process so that you can be saved from these car insurance claims traps.