The Ombudsman is often approached to settle disputes after a claim has been rejected by the insurer.
It is surprising how many claims are not paid out purely because the insured party failed to comply with a specific part of their insurance contract. Below are ten essential tips to make sure you won’t have a claim repudiated.
Complete the application in full and correctly
Full details must be given to the insurance company at all times. It amounts to dishonesty if you fail to disclose all information or misrepresent facts. Also be aware of any spelling or administrative errors.
Consider insurable interest
At all times make sure you as policyholder, have an insurable interest in the assets covered by your insurance policy.
You are not allowed to insure assets that technically do not belong to you. A good example here would be parents who want to insure their children’s vehicles under their policy because it is less expensive.
Most insurers, however, prefer that children’s cars are insured under their own separate policy, especially if the car is registered in the name of the child and he or she is no longer financially dependent on parents.
Drivers must have a valid driver’s license
If your policy allows anyone else (except you) to drive your car with your consent, the person who is driving at the time of an accident must have a valid driver’s license. If not, you will not be covered and your claim might be rejected.
It is your duty to do everything in your power to prevent possible losses. For example, it is not wise to leave your car keys in your car, or to have your handbag or purse visible on the seat next to you when driving. By doing so, you run a greater risk of having your car stolen or of becoming a smash and grab victim. Rather lock away your valuables in the boot.
Make sure your vehicle is roadworthy at all times
One of the best examples is worn-out tyres. If your vehicle skids on a wet road and you crash into the car in front of you while your tyre tread is less than the minimum amount allowed (1mm), your claim may be rejected. Accidents happen, but it remains your responsibility to keep your car in a roadworthy condition at all times.
Ask yourself if you meet all the security requirements
Cover for theft or hijacking is subject to the specific security requirements of your insurer. Make sure you stay up to date on your insurer’s requirements and the implications of not meeting these requirements. It is also advisable to provide your insurer with proof of installation of any tracking devices or other security features.
Forget about ‘one for the road’
Should you be involved in an accident while driving under the influence of alcohol (or any drugs) the insurer may reject your claim, even if you were not the guilty party. Rather take a taxi/Uber or arrange a pick-up.
Make sure your monthly premiums are up to date
If you submit a claim and your monthly premium has not been paid, you will not have cover. If you have a problem making payment, contact your insurer well in advance to make alternative payment arrangements.
Double-check you are not underinsured
For example, if you have not reassessed the value of your home contents in some time, you may actually be underinsured. While your claim may not be rejected entirely, you certainly won’t get sufficient funds to cover your losses. It is your responsibility to keep an eye on replacement values and to make sure you are insured accordingly.
Chat to your financial adviser for assistance
Remember, premiums are based on your risk profile and the type of cover you require. Ask your adviser for different quotes to get the best cover for you, which really meets your needs and suits your budget. Your adviser is there to help you make sure that you are sufficiently covered. Your adviser will also help you to navigate through all the technical policy wording and requirements, as these differ between insurers.