While standard motor insurance covers accidental damages and many other things, monsoon-specific damages are not covered.
The arrival of monsoon may be good news for people reeling under the heat wave, but certainly not for car and other vehicle owners. After all, heavy rains mean flooded streets and damage to vehicles, which can sometimes be very heavy on one’s pocket. Worse, while standard motor insurance covers accidental damages and many other things, monsoon-specific damages are not covered. For instance, engine damage due to water ingression will not be covered. Similarly, an standard policy will not pay for the depreciation amount on the repair and replacement of parts.
“During monsoon every year, there is a significant rise in the number of claims reported by car insurance policy holders. The insurance claims are settled as per the respective covers opted by the policy holders. The most common losses reported in this season occur due to the water accumulation on the roads causing vehicle breakdown and damage to engine. Besides, poor visibility due to foggy roads is another critical factor that sometimes lead to multiple vehicle collisions,” says Manohar Bhat, Chief Business Head, Motor Insurance, Bajaj Allianz General Insurance.
Rajiv Kumar, MD & CEO, Universal Sompo General Insurance, says “Vehicles are considered to be very susceptible towards damages in the monsoon season. Damages to the vehicle in monsoons can be caused by many reasons, like a road accident due to bad road conditions or falling of a tree on the vehicle in a storm. A basic motor insurance policy (Third Party + Own Damage) would compensate the customer for any small damages and even total loss caused to the vehicle through an accident, but won’t cover many damages caused to the vehicle by other monsoon conditions.”
During the monsoon season, most of the motor claims are filed for common damages such as:
# Vehicle breakdown
# Engine breakdown
# Hydrostatic lock in engine (caused when water enters the engine)
# Cleaning of vehicles submerged in flood waters.
# Accidents due to poor visibility or multiple vehicle collision (multi-vehicle pile-up).
A motor insurance policy typically covers cleaning charges if the vehicle is inundated. It also covers the accidental damages to the vehicle. However, a standard motor insurance policy does not cover engine damage caused by water seepage (hydrostatic lock). It also does not take into consideration the depreciation amount on the repair and replacement of parts while determining the claim amount payable.
There is, thus, no monsoon-specific cover for motor vehicles. However, there are a number of add-on covers that can be bought with the standard motor insurance policies. “The add-on covers that come to the rescue of a car owner during the monsoon include Depreciation Shield and Engine Protector covers for engine breakdown due to hydrostatic lock. These motor add-on covers ensure loss coverage that may not be covered by a normal motor insurance policy and also help bring down the self-paid spends for repairs,” says Bhat.
Below are three add-on covers:
Depreciation Shield: In motor insurance, at the time of determining the claim amount payable, depreciation is deducted on certain types of vehicle parts being repaired or replaced, such as plastic/fiber parts, rubber, paint, etc. depending on the make and age of the vehicle. By opting for Depreciation Shield cover at an added premium, at the time of a claim, depreciation is considered to be zero on these parts and claim is paid in full subject to the maximum declared value of the vehicle. Thus, it helps in negating any major cost that would otherwise have to be borne by the individual out of his own pocket.
Engine Protector: This covers consequential damage to the engine parts arising out of water ingression (hydrostatic lock in engine due to water entering the engine), common in flood-prone areas or in case of heavy rains and waterlogging on roads. Not only this, it also covers damage caused to the gear box due to leakage of oil. “Damages to the engine can cost a hefty sum for repair charges or engine replacement charges, if the customer has not opted for an Engine Protect cover. The replacement cost can go up in lakhs of rupees, depending on the make and body of the vehicle,” says Kumar.
Road Side Assistance cover: This cover is suitable for vehicle owners who frequently travel by road to neighboring cities or states for work and leisure purposes. Under this cover, insurance companies provide assistance services on the site of any mechanical breakdown the car has encountered. Services such as on-site battery Jump Start, Tyre Replacement or Refilling of Fuel are extended to customers. In extreme adverse cases, insurance companies also ensure that a Towing Car is arranged for towing the insured vehicle to the nearest garage as well as arranging for an alternate vehicle or a hotel stay.
Insurers say that apart from these covers, an add-on motor cover like ‘Return to Invoice‘ would compensate the actual value of the vehicle at the time of purchase, in case of any damages to the vehicle is termed as a ‘Total Loss’ by the insurance company and is beyond repairs.
What should you do?
Considering that motor insurance is a compulsion for all the vehicle owners, most of the people buy a policy due to the fear of law. “It is wiser, however. if a person chooses the cover carefully according to the cities or location he/she resides at and as well as by opting for relevant add-on covers. Choosing such covers saves last-minute expenses during exigencies. For example, a customer living in coastal areas such as Mumbai, Chennai and Goa must look for covers that will help him/her to cover vehicle damages that may occur due to rain/flood water seepage,” says Bhat.
However, for customers who do not wish to opt for motor add-on covers, “we advise for some basic hygiene check-ups of the car at an authorized service center as well as safe driving during the monsoon season. Also, while parking the vehicle, ensure the vehicle is not parked under a leaning tree which can be uprooted anytime due to strong wind currents or on a slope or at the end of the slope, where due to the water currents, your vehicle can be washed away,” informs Kumar.
Some other Do’s and Don’ts during monsoon
# Ensure that your car is in healthy condition; tyres, brakes and wipers, especially, must be in top shape. It’s a good idea to get a set of new wiper blades at the start of each monsoon season.
# Whenever possible, stay off the roads during heavy rains. If you are on the road and visibility gets worse, park someplace safe.
# Maintain a safe distance with the car ahead, one that’s twice as longer than in the dry. Braking distances are severely affected on wet roads.
# When your vehicle is inundated, you must contact your insurer and get the vehicle towed to the nearest network garage or a nearby repair centre.
# In case of an accident, inform the insurance company about the loss immediately to prevent further loss.
# Avoid driving through the areas where water gets accumulated frequently.
# When your car is stuck in a water-logged area and cannot be moved, it is advisable to leave it at the spot in order to prevent more damages.
# It is wise not to attempt to restart the car by pushing or cranking, as that could cause electrical and mechanical damage to the vehicle.