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september 2015 year
september 2015 year
exclusively for Delo
CASCO Insurance: 5 Popular Reasons for Indemnity Denial
exclusively for Delo

We often come across situation when a client feels to have been unjustly denied indemnity. However there is a number of factors serving as grounds for indemnity denial which are quite formal and simple. Hopefully this article will keep you from making the popular mistakes in order to have your car's repair paid for by your insurance company.

1. A notification of an insured event is not accurate.

What could be easier than to call your insurer and then immediately arrange for your car’s repair? It is not as simple as it seems, though. You are required to perform two actions: 1) contact the call-center of your insurance company to let them know about the accident; 2) submit written notification of an insured event to your insurer’s claims department.  These conditions are stipulated by the corresponding clauses in your CASCO car insurance policy. Moreover, failure to perform either of them can serve as a legitimate ground to deny you indemnity. Insurance can be all about formalities sometimes. Frequent are the cases when a driver contacts his insurer immediately after a traffic accident, then he submits written notification and provides his vehicle for inspection by the claims specialists. In the end he is denied indemnity due to the fact that he forgot to contact call center as well. Ironic, isn’t it? The deadline for doing that varies from 2 to 5 business days unless you do not call the police after the accident. Then you are required to call your insurer prior to leaving traffic accident site. Some insurance policies’ clauses require that the claim surveyor examine insured vehicle right in the traffic accident site. If you fail to wait until he arrives, you can count on receiving no indemnity at all.

2. Registration certificate is inside the car that got stolen.

If your car was stolen together with the registration certificate kept inside, an insurance company has legitimate grounds to deny you indemnity.
It is always stipulated by CASCO insurance policies that for the cases of car theft the insured is required to provide car certificate together with keys. Of course, it is very convenient to keep the registration certificate inside the car, especially if it regularly used by several drivers. This way you do not risk forgetting the documents frequently asked for by the road police. At the same time, if your car is stolen together with the registration certificate kept inside, that is the valid ground for the insurance company to deny you indemnity. Please be aware that although this nuance refers only to the cases of car theft, but it is quite frequent.

3. Driver’s explanatory note referring to the traffic accident is inaccurate.

There are cases when a driver especially if he works for a large company, is not inclined to assume responsibility for a traffic accident in order to avoid fine or other administrative penalty accepted in the company. In his explanatory note he prefers to name brakes failure as the cause of an accident. Please be aware that brake gear failure belongs to the category of vehicle’s defects and is not covered by CASCO insurance even if it brought about the accident. In this case you will most probably be denied indemnity. The little white lie can result in serious financial losses, as you see.

4. Inspection certificate is missing.

In accordance with CASCO insurance policies’ clauses your car is to be inspected by the insurer’s surveyor who subsequently draws up the corresponding report. Obviously it serves the principle goal to make sure a driver doesn’t claim the loss that occurred prior to concluding the agreement.  If for some reason such report is missing, this can be a reason for indemnity denial.  

5. Insurance premium was paid late.

You don’t have to worry if you pay the insurance premium within the deadline stipulated by your insurance policy. However if your payment is even one day late (this is particularly true for policies the insurance premium under which is paid in two or more installments), you’d better provide your car for another inspection by your insurance company. Otherwise you risk not getting indemnity in case of a traffic accident.

Finally, it should be mentioned that if an insurance company delays the payment of indemnity due and fails to provide official letter of denial within the deadline stipulated by your insurance policy, you are entitled to go to court. However it’s wise to make sure that you haven’t given an insurer a valid reason for denial. Also remember to notify insurance company of your intention to sue them. It well may be that they will change their mind not to bear legal expenses and to save their reputation. In case your insurance company declared bankruptcy, contact Motor Transport Insurance Bureau of Ukraine (MTIBU) to have them settle your claim.