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Does car insurance cover theft?

A four-wheeler is a very important asset for home owners. And having it stolen can be a very painful experience. In case of incidents like theft, the first question vehicle owners have is whether their car insurance covers the theft. The answer depends on the type of car insurance policy the vehicle owners have and its terms and conditions.
1 Month ago

The first question vehicle owners ask when a vehicle is stolen is whether their car insurance covers the theft. In this article, we will know in detail about four wheeler insurance that provides coverage against theft.

What types of car insurance policies cover theft?

According to the different needs of customers, there are various car insurance policies available in the market, such as basic third-party motor insurance, self-damage coverage, comprehensive car insurance policies and more.

Basic third party car insurance offers limited coverage. It covers only third party liabilities, such as third party injury/death, damage to third party properties etc.

There are two types of car insurance policies that cover theft – a stand-alone self-damage policy and a comprehensive car insurance policy. In standalone OD cover, loss (theft) or damage to the insured vehicle is covered. However, this policy does not cover compulsory third-party liabilities or personal accidents for the owner-driver.

In comprehensive car insurance, there are various coverage options like car theft, car damage, accidental damage and natural perils as well as third party liability and personal accident cover for the owner-driver.

Additionally, car insurance also has various add-ons such as zero depreciation, roadside assistance, consumer and more comprehensive car insurance policies that have deductibles and sum insured limits. The deductible is basically the amount that the policyholder pays out of his own pocket for the claim. The coverage limit is the maximum amount that the insurance provider will pay for a claim. It is also called Insured Declared Value (IDV), i.e., the prevailing market value of the car.

Does car insurance cover theft of personal items or belongings?

Leading insurance companies like Tata AIG offer an add-on called 'Loss of Personal Belongings' with their comprehensive car insurance policies. This add-on covers damage to personal belongings kept inside the car. However, it may not include coverage for expensive items like laptops, watches, sunglasses, etc. Be sure to read the policy document for items covered.

Does car insurance cover vandalism?

Comprehensive car insurance provides coverage against vandalism. Suppose the policyholder's vehicle is damaged, and the vehicle owner gets coverage against vandalism as per the terms and conditions of the policy. In that case, the compensation amount will be released by the insurance providers. However, vehicle owners need to take necessary steps to request a claim.

Steps to be taken in case of car theft – Filing an insurance claim

In case of car insurance coverage in case of car theft, the following steps should be taken.

  • Step 1: Filing of FIR

The first step in case of vehicle theft is to report the incident to the authorities. It is the vehicle owner's right to report the incident first.

This is not only an essential document to get the compensation amount, but it will also help the authorities to trace the vehicle. This should be done within a few hours of the incident. Delay in filing FIR may lead to rejection of four wheeler insurance claim.

  • Step 2: Notify the insurance provider

The next step after lodging an FIR is to inform the insurance provider about the incident. Insurance providers have a set of procedures to follow depending on the policy they offer. Policyholders can access the website and fill the insurance claim form. A copy of the FIR must be submitted along with the claim form. To make claims processes hassle-free, Tata AIG has a team of 650+ claims experts.

  • Step 3: Notify the Regional Transport Authority

Another important step to take is to report the incident to the Regional Transport Authority in your area. This will help avoid re-registration of vehicles in different names. Also if any vehicle is involved in any illegal activity it will help the authorities to trace the vehicle.

  • Step 4: Submit all required documents

Further, to get the claim amount, the policyholders must submit a list of documents to the insurance providers on time. These documents are:

  • Car insurance policy paper
  • Copy of FIR
  • Copy of vehicle registration certificate.
  • Copy of driver's license
  • Duly signed and filled claim form
  • Copy of RTO documents
  • Original vehicle keys

These documents help the insurance providers to handle the paperwork. After verifying all these documents and policy clauses, the insurance companies will declare the compensation amount. It is best to ensure that the car insurance policy is up to date when filing an insurance claim.

Step 5: No Trace Report

In most car insurance cover theft cases, the insurance company waits for a no-trace report from the concerned authorities before releasing the compensation amount. This report specifies that the stolen vehicle cannot be located. The police usually issue this report, and it is issued after a thorough inspection of the vehicles from the date of the incident.

The relationship between car insurance theft cover and anti-theft devices

Insurance providers consider anti-theft devices, such as GPS tracking devices, car alarms, kill switches, etc., as risk mitigation tools. These devices help increase vehicle security against vandalism, theft, vandalism, etc. With all this in mind, insurance providers offer significant benefits to vehicle owners who have installed anti-theft devices in their vehicles while purchasing a car insurance policy. These benefits are in the form of discounts, lower premium rates etc.

conclusion

According to the Motor Vehicle Act, it is mandatory to buy third party car insurance . But it is important to know that only standalone self-damage cover and comprehensive car insurance policies protect against theft or vandalism. Before buying an insurance policy, it is best to compare car insurance based on inclusions and premium amounts. It is best to opt for a comprehensive car insurance policy as it provides coverage against various situations like personal accidents, man-made calamities, etc. Additionally, it has various add-ons depending on the policyholder's choice, such as roadside assistance, zero depreciation cover, etc. To enhance vehicle safety.

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