Car theft is not new news. Even it is a big problem because a huge number of car theft cases come every year. If you lost your car and have a comprehensive car insurance policy then you can file the theft claim. Third-party insurance does not provide you coverage for your own damage and theft claim.
Basically, there are two important aspects, first, you should take all the maximum possible steps to secure your car. And second, you should have the best car insurance policy. So that in case your car is stolen by someone, you have the option to get a theft claim from your insurer.
Steps of the Theft Claim Process
Under the theft claim, the insurance company pays you the theft claim amount and It is something different from an accidental damage claim. A theft claim is also a lengthy process because here insurance company does a detailed investigation.
Police departments also do searches and investigations to trace the car. So it takes some more time in comparison to a damage claim. You need to be very careful while processing the theft claim. Do the proper formalities and documentation. The claim process may vary from one insurance company to another one.
However, the following are the steps for the theft claim process for car insurance:
1- Inform Your Insurance Company
Whenever your car is stolen, you should inform your insurer immediately. Notify the details of the incident and or situation to the company. Understand the company’s complete Theft claim process and formalities. Also, you should call your insurance agent and explain the situation.
Your insurance agent may also help you to understand the procedure and documentation. He may also help you to process the theft claim as soon as possible. I can understand the situation if your dream car is stolen. At the same time, I will advise you to please be cool and calm.
2- Do FIR (First Information Report)
This is a very important point and FIR is a must in case of a theft claim. You should report the case immediately to your nearest police station. In case of the absence of an FIR, your insurance claim may get rejected.
You should not do any kind of delay in reporting to the police. Unnecessary so much delay can reject your claim. Once you are sure about the theft of your vehicle then inform your insurer and police without any delay.
3- Intimation to RTO
The next step is to inform your RTO (Regional Transport Office). For legal purposes, you need to submit a theft intimation letter to your RTO. Submit a letter to the RTO where your vehicle was registered.
4- Theft Claim Documentation
After doing all the above you have to submit all the required documents to your insurance company. Documents list and formalities may vary from one insurance company to another company. Normally you have to submit the following documents: Claim Form, FIR Copy, RC Copy, Driving License Copy, KYC documents, RTO Papers, All Keys, etc
You should provide all the documents with proper care. Missing any required documents may delay your claim process. If you get any confusion at the time of theft claim documentation then you may take the help of your insurance agent. You can also take the help of an insurance company to understand the requirement properly.
5- No Trace Report
Another important document of your theft claim process is the NO TRACE REPORT. The police department does the search operation for your vehicle on behalf of your FIR. Police try to recover the vehicle as soon as possible.
If the police do not find your vehicle even after searching for many days (For a specific period) then they provide you a letter that is called NO TRACE REPORT. Now you have to submit the letter to your insurance company to finalize the theft claim.
6- Investigation by the Insurance Company
Simultaneously insurance company does its own investigation for your claim. The insurer tries to find out all the facts and figures. The company may do a detailed investigation to get that there are no fraud elements available in the case.
If the company finds out of any fraudulent activities in the claim or fake documents from your side etc then the company can hold or reject the claim. Companies have their own resources to check the authenticity of all the documents and facts.
7- Approval of theft Claim and Settlement
After investigation and all documents (including No Trace Report) formalities company come to the final stage. If the company found all the things satisfactory you get the final approval for your claim.
After the final approval company does the final formalities for claim settlement and then you get your claim amount. You get the final amount as per your policy terms and condition. You must cancel your RC as per the process and guidelines.
What will be the Claim Amount in case of a theft claim?
Normally final claim amount is paid according to the Insured Declared Value (IDV) of the car. Insurance companies may deduct some amount according to your policy terms.
In some cases, the insurer will pay the purchase amount of the vehicle. It is possible when you have a Return to Invoice add-on cover in your policy. In this case, your insurer will pay the invoice value of the car.
What if you are not satisfied with the claim amount?
What should you do if you are not satisfied with the final claim amount? If you think that the company is not paying the right amount or you have some doubt about it then hang on for a moment. You have many options that you can implement.
First, you check where is the gap in the amount and read your insurance policy terms & conditions. You take the help of your insurance agent or any other expert to understand the exact points.
If you are not satisfied then you can request to review the calculation for the claim amount. You should also mention your all valid points that why you should get a different amount.
if a company doesn’t give a satisfactory answer then you can opt for consumer court or legal option also. If you are right then you can fight for it and your insurer will have to pay you a satisfactory claim.
What about your personal belonging? Will you get the claim of LOPB?
Loss of personal belonging (LOPB) is normally not covered in a basic comprehensive insurance policy. To get the coverage for the belonging item you need to purchase a separate add-on cover in your insurance policy.
If you have this add-on then the company will be liable to pay a claim for the personal belonging. Whenever you purchase this add-on cover then please read its terms and condition properly. There may be some inclusions and exclusions in the cover which you should know.
You should not assume that the company will pay a claim for all personal belonging that you will lose in any theft. One more thing you should mention is your lost item in the FIR.
What may be the reasons why your claim was denied by the company?
Ideally, insurance companies do not reject any claim without any valid reasons. Your claim may be rejected by the company due to any valid reasons. So you need to take care of those points.
Once you should go through your policy wording. So that you can get the details of the terms of the insurance policy. Here are some points which may be the reasons for claim rejections:
You should provide the correct vehicle registration type to the insurer. For example, you have purchased your policy for private cars but your vehicle is registered as a commercial. In this case, the company may reject the claim.
In another case, if You have a private car insurance policy for your car but are using your vehicle as a commercial then also the company may reject your claim.
Your insurance company may also reject your theft claim because of some of your negligent behavior also. This is your responsibility that you will take all the necessary steps to safeguard the vehicle.
But if do the thing like – you leave your car key inside of the car and the door is unlocked also or you parked your car in an unsafe place or you have forgotten your key somewhere and you didn’t do FIR or Intimation to your company. All these may be considered as your negligent behavior and the company can reject the theft claim of your car.
Insurance not transferred
This mostly happens in the case of a used car. You have purchased a used car and transferred the vehicle in your name. But you have not transferred the insurance policy in your name. You have also not purchased any new insurance policy for your vehicle. Then in that case company is liable to pay a claim.
Misrepresentation of fact related to theft
Any misrepresentation of facts related to the theft of a vehicle can be the reason for claim rejection. If you have taken the wrong no-claim bonus discount or the wrong anti-theft discount then also the company may reject the claim. So, you should be very careful while providing your details. You should not provide any wrong details to the insurer.
Why insurance company may reject your vehicle theft claim if you don’t submit all the keys?
Normally you get two sets of keys at the time of purchasing the vehicle. That’s why the company was supposed to get two keys from you at the time of theft claim. The company may reject your theft claim if you submit only one key or no key. Maybe you have misplaced it.
The company wants to recover both keys from you because the insurance company wants to ensure that there is no intention of fraud from your side. Insurers also want to ensure that you have taken all the necessary steps to save your vehicle. The company normally denied the claim in case of negligent behavior from your side.