By Mahavir Chopra
What is a car insurance policy till you make a claim? Just a simple document, with maybe a stamp and a signature.
In the last few years, thanks to cheap printing and super simple image processing, counterfeit products have become rampant in India. If currency notes can be fabricated in the country, anything is possible. Anyone with a basic printer, data and image processing skills can start printing fake insurance policies on the fly. No wonder, there are estimates that around 1-2% of the total auto insurance policies in the country are counterfeit, which is close to a loss of Rs 500-800 crore every year for the auto insurance industry.
Unknowingly holding a fake policy can give you a rude shock if you have damaged your car and need to make a big claim. The situation can be murkier if there is a serious accidental injury that takes place, and there is a third party claim raised by the injured party. Motor Vehicles Act puts unlimited liability for compensation on the defaulting driver that is decided only by the Motor Accident Claims Tribunal.
To prevent such tricky situation and episodes, it is important to be extremely careful. Here are a few ways you can avoid getting deceived with a fake insurance policy:
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1. Authorized agent or office: Whether you are buying a policy online or offline, ensure you buy through an authorized distribution channel of a known insurance company. With the industry opening up, there are multiple new brands that are getting license to distribute insurance in India. In case you have not heard of the insurance company you have been advised to buy, it makes complete sense to look up the insurance regulator IRDAI’s portal to check whether such an insurance company is registered with the IRDAI. With respect to agents or online portals, you must check the credentials before you decide to make the payment.
For instance, one must check whether the insurance agent has a valid and active agency/broker license. In case you are buying through an online partner ensure you check the portal’s reviews on social network and review websites to ensure any shocker.
2. Payment/Receipt: In case of offline purchases always insist on issuing the payment directly in the name of the insurance company. In case you are making payment through cheque, ensure you have mentioned the name of the car owner as well as mobile number behind the cheque leaf. Avoid paying by cash and never issue blank cheque to your agent or broker. Finally, insist on an official receipt from the insurance company, in case you are not receiving the policy instantly.
Once you have received the policy document, here are the steps to ensure you have an original policy:
1. Directly check the insurer: You can look up the insurance company’s website for contact details of their customer service and write an email or make a call to authenticate whether the policy issued is genuine. In case the contact details are not mentioned, try to visit the nearest branch for verification.
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2. A quick check of your insurance policy: Check whether all your information is accurately mentioned in the policy. Check the details about your car, the IDV, declaration around No Claim as well as your address and contact details. In case there is any discrepancy, immediately contact the insurance company and insist on revising the policy through an endorsement.
3. QR Code: The IRDAI has issued a circular in November 2015 that requires every car insurance policy in India from December 2015 to contain a QR code to verify the authenticity of the policy. You can look for this code on the face of your insurance policy. Anyone can scan this code using a QR code reading app on your smartphone. This QR code will also help traffic policemen to scan the code and verify the genuineness of the policy. When you scan the QR code, a web page loads on your mobile that provides status and details of your policy as well as car details.
(The author is Director – Health, Life & Strategic Initiatives, Coverfox.com)