Getting Your Car Insurance Claim Rejected Will Cause Undue Financial Strain!
A general definition of insurance is described as a contract between an insurer and an insured, where an insurer renders cover to the insured (has some financial interest / ownership) for a premium on specific uncertain events. Of course, this is a simple definition, but you need to know that this is a Contract of Law which is binding, and any breach will render the policy invalid. Your insurance policy must be read together with the policy wording, where you have a broker, feel free to discuss any aspect with them or contact us to navigate and explain the fine print for you.
Over the years, many reasons for motor claims being rejected have been identified. We have included top reasons sourced mainly from insurers and the Ombudsman for Short-term Insurance as top the reasons for these rejections.
Obeying the rules of the road is key and ignoring them could get your claim rejected. Due to Covid-19, the Disaster Management Act enforces that no travel is allowed on the roads between specific hours (outside curfew) without a permit that allows the performance of an essential service. If you are involved in an accident during this time and it is found that you were breaking the law and the accident is a direct result of this or connected through the “casual nexus” principle, your insurance may be rejected, and you will have no claim. However, there are exceptions, for example, if you were attending to a medical or security emergency outside the curfew hours.
Here are Top 20 Rejections for Insurance Claims on why your claim can be rejected:
1. Unlicensed Driver
Breaking the law renders your claim invalid.
2. Unroadworthy Vehicle
Not maintaining your motor vehicle in a good roadworthy state for example, not replacing your tyres when they are smooth. If you involved in an accident as a result of this your claim may be rejected.
3. Reckless Driving
Driving your vehicle without due care for example, speeding and you involved in an accident will have your claim rejected.
4. Drunken Driving
5. Driver Not the “Regular Driver” or “Named Driver” Only
Some insurers offer policies that only allows for cover on the most “regular driver” or only if your name is stated in the policy to drive the motor vehicle. Part of the reason is to make the premiums affordable but the caveat is that if at the time of an accident it is found that the driver of the vehicle was not noted as the regular driver or named driver, your claim may be rejected.
6. Telematics Data Used to Determine if Driver at Fault
Most insurers require you to install telematic /tracking devices that track & recover stolen vehicles, monitor, and calculate your insurance premiums based on mileage or driving behaviour patterns. The telematic device will pick up if you were speeding at the time of the crash and may result in your claim being rejected.
7. Tracking Device Not Fitted
Most insurers require you to fit in a tracking device unit into your vehicle to assist in recovering the vehicle if stolen. If you do not fit the tracking device and or if you do not test the device from time to time and the vehicle is stolen, you may have your claim rejected for failing to comply with this condition.
8. Total Loss Policy
There are insurance policies that only covers you for when your motor vehicle is a total write-off. This means that if your vehicle is partially damaged you will not have any cover and will have to repair the vehicle yourself. Make sure you know what type of policy you are purchasing.
9. Vehicle Inspection Requirement Not Fulfilled
When purchasing a vehicle most insurers require you to take your vehicle for an inspection to for example, PG Glass, Glasfit or an assessment centre that will check if there are any damages to the vehicle before cover is provided. This needs to be carried out in some cases within 24 hours to 72 hours of taking delivery of the vehicle. Some insurers have Apps that you can use to upload photos and complete the vehicle inspection.
10. Material Non-Disclosure
At the time of underwriting the policy if you do not disclose any material facts regarding your insurance history or information that is important, your claim may be rejected. Here are some examples, not disclosing that you had a break (interrupted) in insurance cover, this happens when you cancel your insurance and don’t have alternative cover. Not disclosing your credit history, where you are blacklisted or have been sequestrated and do not disclose this. Your insurance being cancelled by an insurer and you do not disclose this during underwriting.
11. Not Disclosing Correct Vehicle Use – Private instead of Business
Disclosing that you use your vehicle for private use, that is used only for private and social purposes and not for business purposes. Private use includes driving to and from your regular place of employment and not having the vehicle used as part of your work function. So not travelling to clients or attend meetings outside of your primary place of employment.
12. Vehicle Not Parked Securely At Night
Stating that your vehicle is parked in a garage or behind locked gates and at the time of the claim it is found out that the vehicle was regularly parked in the street, then your claim may be rejected.
13. Security Device Not Fitted
Where there is a requirement to have a security device fitted with an alarm or gear lock and you do not have one fitted then your claim may be rejected.
Building Insurance
14. No Cover for Wear & Tear or Maintenance Issues
There is several exclusions that is not covered for by your insurance policy, one of them is as a result of “gradual deterioration”, meaning wear and tear. It is your responsibility to make sure the for example, the roof is well maintained. Insurance policies for buildings normally cover for storm and fire damage.
15. Poor Design or Faulty Workmanship
Where there is a poor design or construction of any building. Use of faulty materials or bad workmanship will result in your claim being rejected.
16. Subsidence & Landslip for your Building
If your house is built on clay or located in a place that makes it prone to subsidence or landslip, you should contact your broker to check what cover is available. Without this type of cover included in your policy your claim will be rejected.
17. Unoccupied Premises
If you leave your premises unoccupied for example longer than 30 days without informing your insurance company, your claim may be rejected. Consult with your broker or check your policy wording or schedule for the number of days.
18. Moveable Items Not Covered
For Building insurance, any item that can be moved, that is NOT a permanent fixture is covered under House Contents. In simple terms, if you had to turn your house upside down and every item that falls to the ground will be regarded as house contents and will be covered separately as House Contents Cover and not under Building cover.
19. Building Substandard Retaining Walls
Where the retaining walls were not built according to standards specified according to the engineers, your insurer may not pay out your claim.
House Contents Insurance
20. Fraudulent and Inflated Claims
Most policies carry a forfeiture clause that when claims are fraudulent or inflated and you are caught out, the insurer can reject your entire claim.
We are experts
Feel free to contact us on 086 162 0000 or email us at helpme@xinixinsurance.co.za , we will be happy to assist you with your query.