16 Car Insurance Exclusions You May Not Know
What Car Insurance Policy May Not Cover
The term car insurance exclusions may be strange to some people especially the first time car owners. To some extent, people know that they need to insure their cars. That is why some people will not even wait till an insurance agent approaches them before they start making move on their own to locate an insurance company that can insure their cars. With internet enabled laptop or smartphone, one can conveniently shop for car insurance quotes online and then select one that is considered the best in term of coverage and costs. It is not uncommon for novice to focus on cost alone. Unfortunately, it may be too late before they realize that cheap car insurance quote may not mean that they have the best deal. Even with the so called comprehensive car insurance policy which some people think that it covers all the risks associated with their cars, there are still certain events and circumstances that the policy will not cover. Comprehensive car insurance is not synonymous to full coverage. You can’t say because you have insured your car and then think that the insurer will be responsible for everything that happens to the car.
There are certain events or situations that your car insurance policy will not cover. These are being referred to as car insurance exclusions. This means that your insurer will not be responsible for any expenses that you might incur in case of the occurrence of the events or situations. In most cases, your car insurance exclusions will be contained in your policy. The problem is that many people don’t take time to read it. That is why some of them usually feel disappointed when they present claims on what is listed as part of the car insurance exclusions and their claims are rejected. If you don’t want to experience this kind of frustration, it is good that your read and understand the terms and conditions governing your car insurance policy. Let’s look at some of the common car insurance exclusions you may likely find from different car insurance companies.
Read Also: 15 Factors Affecting Car Insurance Premium
List of Car Insurance Exclusions
Policy not in force: If you have existing car insurance policy, it is possible to easily forget when the policy is due for renewal. Even though the insurance company may have sent you the notice for the renewal, you may not have time to check your mail box. It can even be that you got the notice but instead of taking step to pay the premium immediately, you just kept it somewhere else thinking that you would attend to it later. Before you knew what was happening, other events just made you forget about it. So, if you should be involved in an accident during the period that you have not paid your premium, your insurer will let you understand that there is no policy in place. For your car insurance policy to be in force, you need to pay your premium. Insurance premium is usually paid in advance. If you allow gap in your car insurance policy, you also stand the risk of being arrested for driving without car insurance. This is totally illegal and you can be prosecuted for it. In order to avoid this type of situation, you can enroll for automatic renewal. But you must ensure that you always have sufficient amount in your account so that the payment will not be declined.
Wear and tear: A car you bought a year ago cannot have the same value today any more. That is why cars are considered as wasting assets. With time, the value of the car will depreciate either by the reason of wear and tear due to use or by the reason of the car becoming obsolete. Other reasons for depreciation of cars are such factors such as rot, damp, rust and corrosion. Insurance companies will not pay you for the depreciation of your car.
Unapproved drivers: If you allow somebody that is not having driver’s license or an underage driver to drive your car, your insurer will decline any claim you might present as a result of any damage caused by them.
Read Also: Why Car Insurance for Teens Are Usually Expensive
Damage to tyres: If you are driving and your car gets damaged due to potholes or bad roads, your car insurer will not honour such claims. The best you can do for your own safety is to ensure that you drive carefully and you don’t over-speed. This will allow you avoid such tyre damage. Also, if you know you might need road assistance, you may need to apply for road assistance coverage.
Broken glass: It is possible that while you are driving on a rough road, another vehicle matches a stone and the stone hits your car windscreen. If your glass got broken in the process, you will be the one to pay the cost of repairs out of your pocket.
Electrical or mechanical breakdown: You should understand that car can break down anytime due to electronic, electrical or mechanical malfunctioning. Electrical fault can make your car not to kick start. This can happen anywhere without any prior sign. This type of situation can leave you stranded if you don’t get the required roadside assistance on that spot. You should not expect your car insurer to come to your aid or reimburse you for the cost of towing the vehicle. You may need special coverage for this if you so desired.
Intentional Damage: If you damage your car intentionally with the aim of getting reimbursement from the insurance company, this is fraud. A good example is when your car needs to be repainted. And you now hit your car by yourself so that when the car is repaired, the car will also be repainted. This is totally a fraudulent practice. It is part of the car insurance exclusions and your insurer will refuse such claim.
Read Also: Car Insurance: What Liability Insurance Covers
Negligence: As a car owner, it is your responsibility to ensure the proper maintenance of your car. If you are negligent in taking good care of your car, you will be responsible for any inconsequential damage to your car. For example any damage to your car due to oil leakage and clear violation of the manufacturer’s guide will be treated as negligence on your part and your car insurer will not be responsible for any resulting damage to your car.
Reckless driving: You need to drive responsibly. If you over speed or drive under the influence of alcohol, this may result in an accident. Of course, this type of accident is totally avoidable. This is among the list of car insurance exclusions that you will find in your car insurance policy.
Confiscation/Repossession: Any legal confiscation or repossession of your car by police or creditor is not the responsibility of your car insurer.
Unapproved use: If you insured your car as a private car, it means that it is expected that you will use the car solely for private purposes. But if you now decide to use the same car for business, racing or delivery purposes, you are not keeping to the terms and conditions of your car insurance policy. This will definitely void the policy and you will not be paid for any claims you might file in relation to such.
Catastrophic events: There are certain events that are totally uncontrollable either by you or the insurance company. Such events include acts of war, terrorisms, hostilities, radiation, nuclear or biological environmental contamination. All these are car insurance exclusions which your insurer will not take responsibility for.
Personal belongings: If you leave your personal belongings such as laptop and mobile phone in your car and the thief breaks in and carry them away, your car insurer will not pay you back for the lost items. However, you can be reimbursed under renters or homeowners insurance if have any of these in place.
Installed custom equipment: If you make any modifications to your car by installing stereos, TV, DVD Player or custom rims without prior permission, such custom equipment may not be covered by your car insurance policy.
Read Also: How to Get Really Cheap Car Insurance Quotes
Over-loading: Overloading can take different forms. If you carry more passengers or loads above the designed capacity of the car or what the law permits, it is overloading. Also, if you use your car to tow another vehicle that is above what is contained in your car manufacturer’s specifications, it will be regarded as overloading. Overloading is excluded from your car insurance cover.
Car loan: If your car is financed, you are the one responsible for the repayment of the loan if you can happened to be totalled in an accident. The car insurance company will only reimburse you up to the value of your car less your deductible. If the reimbursement you get from your insurer is not enough to pay back the car loan, you will need to pay the balance out of pocket. If you set your deductible too high, you may find it difficult paying it. And without you paying your deductible, the insurance company will not pay their part.