How to Handle Car Insurance Disputes with Insurers?

What Are the Common Reasons for Car Insurance Disputes?

Understanding the root causes of disputes is the first step towards resolution. Most disagreements between insurers and policyholders arise due to:

 

• Disagreement over liability: The insurer may believe you were at fault or partially responsible for the damage.

   

• Undisclosed modifications: Modifying your vehicle without informing your insurer can invalidate your claim.

   

• Incomplete documentation: Missing details, reports or receipts often delay or deny settlements.

   

• Delayed intimation: Not informing your insurer within the required timeframe can lead to disputes.

   

• Exclusion clauses: Sometimes, a claim may fall under policy exclusions that the insured overlooked.

 

In each of these cases, the Car Insurance claim dispute process involves providing evidence, clarification, and, in some situations, escalating the complaint to a higher authority.

 

What Are the Reasons Why a Car Insurance Company Rejects a Claim?

A rejected claim can come as a shock, but it usually stems from specific procedural or contractual missteps:

 

• Violation of policy terms: For example, driving without a valid licence or under the influence of alcohol.

   

• False declarations: Providing incorrect information during policy purchase or claim intimation.

   

• Expired policies: If your policy has lapsed and a claim is made, it will likely be rejected.

   

• Unauthorised repairs: Getting the vehicle repaired without insurer approval, especially for cashless claims.

   

• Delays in documentation: Even valid claims may be denied if required paperwork is not submitted on time.

 

If your Car Insurance claim is rejected, the insurer must communicate the reasons in writing. Keep this rejection letter as it becomes essential when initiating the Car Insurance claim dispute process.

 

What Is the Step-By-Step Process to Handle Car Insurance Disputes With the Insurer?

If you believe your claim has been unfairly denied or mishandled, follow these steps:

 

1. Recheck the policy terms

Start by reviewing your policy document. Understand what’s covered, what’s excluded, and if the rejection aligns with the policy.

 

2. Gather supporting documents

Collect all relevant materials: FIRs, repair bills, photographs and communication records.

 

3. Contact the grievance redressal officer

Every insurance company in India must have a designated Grievance Redressal Officer (GRO). Submit a formal written complaint to the GRO, mentioning your policy number, claim details, and objections.

 

The IRDAI mandates that insurers acknowledge complaints within three days and resolve them within fifteen days.

 

4. Escalate to IRDAI

If the insurer doesn’t respond within 15 days or the solution is unsatisfactory, escalate the matter via the Bima Bharosa System, IRDAI's official grievance redressal portal.

 

5. Approach the Insurance Ombudsman

If no resolution is reached, you can approach the Insurance Ombudsman for free and impartial redressal.

 

At every stage, ensure you document your communication and retain copies of all emails and letters. This record is crucial to the Car Insurance claim dispute process.

 

What Is the Role of the Insurance Ombudsman?

The Insurance Ombudsman is a quasi-judicial authority set up by the IRDAI to resolve complaints between policyholders and insurers, especially those involving low-value claims (up to ₹50 lakhs from July 2021 onwards as per IRDAI guidelines).

 

You can approach the Ombudsman if:

 

• Your complaint wasn’t resolved by the insurer within 30 days.

   

• You received an unsatisfactory response.

   

• The dispute involves issues like claim delays, denials or policy servicing.

 

The process is consumer-friendly:

  

• No legal representation is needed.

   

• The decision (called an “Award”) is binding on the insurer, but not on you. You are free to accept it or pursue other legal remedies.

 

The Ombudsman plays a vital role in strengthening consumer trust and simplifying the Car Insurance claim dispute process.

 

Things to Keep in Mind While Claiming Car Insurance

Avoiding disputes often begins with a careful and proactive approach to your policy. Here are essential tips:

 

• Read your policy document thoroughly: Don’t skip the fine print. Know what’s covered and what isn’t.

   

• Inform your insurer immediately: Most companies require intimation within 24-48 hours of the incident.

   

• File an FIR when necessary: For theft, major accidents or third-party damage.

   

• Retain all documents: Photos of the accident, bills and service records help speed up the claim.

   

• Avoid modifying the car without notice: Cosmetic or engine modifications must be disclosed to avoid rejection.

   

• Use authorised garages: For cashless claims, stick to the insurer’s network.

 

These practices don’t just help prevent your Car Insurance claim from being rejected; they strengthen your case if a dispute does occur.

 

Conclusion

Navigating the Car Insurance claim dispute process doesn’t have to feel like a dead end. With the right knowledge and approach, you can challenge unfair decisions and get the coverage you deserve.

 

If you’re looking for a provider that prioritises claim transparency and efficient service, consider Shriram Car Insurance. With a reputation for prompt claim settlement, a wide network of garages and dedicated support for every policyholder, they make the road ahead smoother, even when the unexpected happens.

 

FAQs

1. What if my Car Insurance claim is rejected, but I have all the documents?

If the issue is not resolved, you can take it to the Ombudsman after initiating a dispute through the insurer's grievance cell.

 

2. Can I take legal action against my car insurer?

Yes, after exhausting all other alternatives, including the Ombudsman, you can approach consumer or civil courts.

 

3. What is the IRDAI’s role in Car Insurance disputes?

The IRDAI does not settle individual issues directly, but it does provide a grievance site (Bima Bharosa) and oversees the Ombudsman system.