It’s a rainy winter’s morning and you’re on the road against your better judgement when there is a loud crash. You’ve been in an accident. The next few moments are filled with questions as you try to collect yourself and get the necessary details from the other driver for insurance purposes.
But what if – after all that - your car insurance claim is rejected?
According to the 2017 report from the Ombudsman for Short-Term Insurance (OSTI), Deanne Wood, this is not uncommon. A recent press release from her office stated that it receives far too many complaints where policyholders withheld certain information or provided incorrect details on purpose. All to try and pay a lower premium.
This is bound to backfire since all claims are thoroughly investigated.
According to Natasha Kawulesar, head of client relations for Outsurance, the following are the biggest reasons why a claim will be rejected:
1. Damages that are being claimed for is not covered by your insurance option e.g. the mechanical breakdown of a car.
2. The damages are due to wear and tear, which is a general industry exclusion.
3. The cover is insufficient. For example, under limited vehicle cover there is no cover for accidental damage to the car.
4. People are often unaware that if you miss a certain number of payments, typically two, any insurance claim that you tender during this time could be denied on these grounds.
5. You drove under the influence of alcohol.
Wood also added that consumers should take note that another leading cause for a rejected claim is alleged misrepresentation of underwriting details.
In a recent press release issued by Indwe Risk Services the following are mentioned as misrepresentations:
If your claims history, previous insurance history and credit history are in bad standing.
- If the person who caused the accident is not the regular driver of a vehicle.
- If there was a misrepresentation about what the purpose of a vehicle is (personal vs business).
- If you lie about having a tracking device in your vehicle or any other related security system.
Can I dispute a claim rejection?
You have an option to dispute your claim rejection. Most insurers have an internal dispute resolution process. After the matter is reviewed, the client will be provided with the outcome of the process.
Alternatively, if you’re not satisfied with the outcome you are encouraged to approach OSTI on 011 726-8900 or email email@example.com.
Tip: To apply for car insurance today, click here.