A motor insurance policy is a necessary requirement for a vehicle owner, be it for a car or bike irrespective of its usage for commercial or private purposes. When you comply with this requirement, you are on the right side of the law keeping you safe from fines and penalties.
But other than complying with the Motor Vehicles Act, a car insurance policy provides a financial cushion. But to claim any damages, you must raise a claim with your insurance company. This process is defined by every insurer which is more or less the same barring minor formalities.
As a policyholder, you might have wondered: how many claims can I raise in a policy year? This article aims to answer this burning question helping you thoroughly understand everything you need to know about insurance claim in your policy.
How many claims are allowed during one policy period?
In reality, there is no limit on how many claims that can be made with your insurance policy. Any number of claims can be made by a policyholder during a period. However, the maximum payout is limited to the insured declared value or IDV of your policy. *
But when it comes to raising a claim for the different add-ons that you have bought, there might be some limits which vary among insurance companies. For instance, a zero depreciation policy generally restricts the claim for upto two instances. These terms however, differ from one insurer to the other. *
* Standard T&C Apply
Is there a number on how many insurance claims are too many claims?
This question has no specific answer but depends on the type and extent of damages. Insurance experts recommend not making a claim for minor repairs. Only major expenses must be reimbursed from the insurance company to avail policy benefits at renewal. * Standard T&C Apply
What are the implications of making multiple car insurance claims?
As discussed above, there is no limit on how many claims you can make but must not be made for small repairs. Doing so will impact your policy in the following ways:
- Loss of no-claim bonus (NCB)
A major downside of raising multiple car insurance claims is losing out on any accumulated NCB. NCB or no claim bonus is the concession that your insurance company offers at renewal for a claim-free policy year. The no-claim bonus starts at 20% and increases upto 50% for every consecutive claim-free policy period and is calculated on the own-damage premium. Thus, repeated third-party claims do not impact any renewal NCB benefits. * You can visit the official website of IRDAI for further details.* You can visit the official website of IRDAI for further details. *
- Rise in premium rates
If you raise multiple car insurance claims, the insurance company may increase the premium when you renew your insurance coverage. This is done by the insurance companies to compensate for the increased risk that is attached to you as a policyholder. In addition to the increase in premium, multiple insurance claims also restores the premium by taking away any accumulated NCB benefits. * You can visit the official website of IRDAI for further details. *
- Payment of deductibles
Deductibles are payments that you, the policyholder, need to make before the insurance coverage kicks in. So, making multiple insurance claims in one policy period will require you to pay a substantial amount for the repair costs, depending on your policy terms, and only then will be compensated by the insurer. *
These are the drawbacks of making multiple claims although there is no particular restriction on doing so. When you are buying an insurance cover for your car, make sure to use a car insurance calculator that helps to compare the different policies and also make a cost benefit analysis using this nifty tool. *
* Standard T&C Apply
Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms and conditions, please read sales brochure/policy wording carefully before concluding a sale.
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