Car insurance is a mandatory investment by law. Therefore, a large number of car owners choose to pay a premium for an auto insurance policy to protect their cars against a potential collision. However, despite this, most of their claims are rejected by the companies. This is because people are unaware or rather unaware of the intricacies related to auto insurance. Therefore, a large part of auto insurance claims are denied. To prevent this from happening, let’s go over a list of reasons why an auto insurance claim could be denied:

1. Informing your insurer late or not informing you: We inform you that your claim is destined to be rejected if you do not inform your insurance provider within the stipulated time. On average, you should update your insurance company within 48 to 72 hours from the time of the accident or collision.

2. Driving under the influence of alcohol or any other drug: This one is a no-brainer, but still most people are negligent about it. If you drive when you have consumed alcohol, not only are you breaking the law, but even your insurance company will refuse to cover you in the event of an accident.

3. If your car is used for business purposes: If you have a private car and it is used for any business use, such as transporting goods or passengers, your auto insurance provider may deny your claim. This is because there are different policies for private cars and commercial vehicles.

4. If you drive without a valid license: In the event that you or anyone driving your car has a valid driver’s license and is involved in an accident, your coverage will be null and void. Therefore, be sure to renew your license on time.

5. Begin Repairs Before Insurer Inspection: When you report the collision or accident to your insurer, an adjuster will visit you to inspect the condition of the car and authenticate your claim. Without this inspection, the insurance company will not be able to track the extent of the repairs and estimate the cost involved. Therefore, your claim is bound to be denied.

6. Do not transfer the policy from the previous owner: There will be some verification during the claim process. In the event that the auto insurance policy is not in your name, your insurer has the right to deny your claim.

7. An electrical or mechanical breakdown: In case your car is damaged without an external collision due to any electrical or mechanical breakdown, then it is not covered by your auto insurance policy. In this case, you will have to shell out some money from your own pocket.

Next time, be more careful about all these reasons and make sure you get the most out of your auto insurance policy.