Moneycontrol
Last Updated : Mar 21, 2018 03:30 PM IST

Car fire insurance claim - All you need to know

The following article is an initiative of BankBazaar.com and is intended to create awareness among the readers.

Keeping with the growing economy and the increased purchasing power of the consumers, there has been a rapid rise in the vehicle population of the country. The increase in the number of vehicles on the road has resulted in heavy traffic and more number of road accidents. Car fire incidents are a significant part of vehicular accidents. You may have come across national and regional news coverage about numerous car fire incidents across the country. Car fires can cause severe damage to life and property. It is one of the biggest safety concerns that the automobile industry is forced to acknowledge.

What causes car fires?

Vehicles catch fire either due to mechanical defects or short circuits. Mechanical defects include overheated engines, high pressure in certain parts of the vehicle, and fuel or oil leakage. Ideally, a vehicle battery can accommodate only the standard accessories that have been fitted to the car at the time of manufacturing. Short circuits occur as a result of tampered electrical wiring while fitting additional accessories (fog lamps, amplifiers, alarms, headlamps, woofers and so on) to the car. A malfunctioning electrical wiring system can cause certain parts of the vehicle to heat up and catch fire. Similarly, car repairs like repairing air conditioners, installing air filters or replacing LPG kits when not done properly may cause sudden fire incidents.

Take precautionary measures like keeping a fire extinguisher handy in your car in order to put out small fires. If you want additional features in your car, pick a car that already comes equipped with it at the time of manufacturing. There is news of automakers launching updated versions of some of their successful car models across the segments in 2018. These days, information about upcoming cars is available at the click of a button. You can visit a reliable car trade website to compare the prices, features and specifications of various car models on the market. What’s more, funding or car loan for new and used cars is offered by banks and Non-Banking Financial Companies (NBFCs) at competitive interest rates and flexible loan tenures.

What to do if your car is damaged due to fire?

No doubt the question on your mind is - Will my car insurance cover any loss or damage caused by fire? Although only a third-party car insurance policy is mandatory for all vehicles on Indian roads (Motor Vehicle Act, 1988), a comprehensive auto insurance policy will be more beneficial in the case of a fire damage. A comprehensive car insurance policy will cover any loss or damage to your car caused due to fire. The insurer will honor your claim only if there has been an actual fire that causes damage to the electrical or electronic components of the car as a result of overheating or short circuiting.

Like any other insurance, once a claim incident has occurred, in this case, car fire, you must immediately report the incident to the authorities and your motor insurance provider. File an FIR at the nearest police station as the document will be needed to support your claim. The insurance company will appoint a surveyor to carry out an investigation on the spot to find out the cause of the fire. You car fire insurance claim will be honored, provided there is no evidence of deliberate tampering of the car electrical wiring system. If the car fire was a result of fitting additional accessories that consume high voltage power, then your insurance claim may be denied. If you want to fit authorised accessories to your car, ensure the original electrical wiring system is not tampered with.

Sometimes, as terrifying as it may sound, cars are set on fire in a riot. This deliberate act of damage to property is called vandalism. You must report the incident to the authorities and the insurer at once so as to make an insurance claim. Another instance of a car fire insurance claim is if your car is parked in the garage and your house is on fire, unfortunately, your home insurance may not cover the damage to your car. In this case, a comprehensive car insurance policy will be beneficial. In the case of an engine fire that results in the total loss of your car, the insurer will pay the actual cash value of the car minus the deductibles.

If the car fire is caused as a result of a collision, the insurance company will determine whether the damage will be covered by a third-party insurance policy. That is why, it is important to find out the extent of coverage offered by your motor insurance policy before purchasing it. Car insurance renewal is another important factor to keep in mind. Like health insurance, your four-wheeler and two-wheeler insurance policies have to be renewed at the end of a policy year to enjoy continuous coverage. What’s more, comparison, purchase, and renewal of motor insurance can be done online with just a few clicks of your mouse.
First Published on Jan 10, 2018 01:05 pm
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