Avoid these 7 common car insurance mistakes, from letting a policy expire to hiding facts, so your claim goes smoothly. Read the tips and get a quote.
The most common car insurance mistakes are letting the policy expire, choosing only the lowest premium, setting a wrong IDV, hiding facts, delaying a claim, ignoring exclusions and buying add-ons without thinking. Each one can cost you money or lead to a rejected claim. All of them are easy to avoid.
Here are the seven mistakes and how to stay clear of them.
Mistake 1: Letting the policy expire
If your policy expires, your car is uninsured from the next minute. Driving without valid insurance can lead to a fine of ₹2,000 and/or up to 3 months jail for a first offence, and ₹4,000 and/or up to 3 months for a repeat offence.
An expired policy also means a claim will be rejected. The insurer may ask for a vehicle inspection before renewing, and your NCB may be lost after a long gap. Set a reminder a few weeks before expiry. See how to renew vehicle insurance on time, or read about renewing an expired car policy.
Mistake 2: Choosing only by the lowest premium
A low premium can look attractive, but it may come with a low IDV, fewer add-ons or a high deductible. At claim time, you may find the cover is too thin.
Compare the whole plan, not only the price. Our guide on how to compare car insurance plans shows how to do it step by step.
Mistake 3: Setting a wrong IDV
IDV (Insured Declared Value) is the market value of your car and the maximum amount paid for theft or total loss.
- If IDV is set too low, you may receive less than your car is worth.
- If it is set too high, you may pay more premium for little gain.
Pick an IDV that matches the real market value. Read more in what is IDV in car insurance.
Mistake 4: Hiding or giving wrong facts
Be honest when you buy or renew. Tell the insurer about:
- Past claims.
- Changes to the car, like a fitted CNG kit or other modifications.
- How you use the car. A private car must not be used commercially.
- The correct owner details.
Wrong or hidden facts are a common reason for claim rejection. It is better to share the facts now than to face trouble later.
Mistake 5: Delaying the claim report
After an accident, theft or other loss, inform your insurer quickly. For theft, major accidents, third-party injury or death, or riots, inform the police too. Late intimation can lead to rejection.
Also avoid moving or repairing the car beyond need before the survey. Our post on the car insurance claim process gives clear steps, and claim support can guide you.
Mistake 6: Not reading exclusions
Every policy has things it does not pay for. Typical ones are wear and tear, mechanical breakdown, drunk driving and driving without a valid licence. Engine damage after starting the car in floodwater is another common one, and it usually needs the engine-protection add-on.
Read the exclusions before you buy, and ask questions if something is not clear.
Mistake 7: Buying add-ons blindly, or skipping useful ones
Some people buy every add-on offered. Others skip all of them. Both can be a mistake.
- Pick add-ons that fit your car's age, your area and your driving.
- Check limits, like the number of claims per year.
- Do not pay for an add-on you cannot use.
For help, read car insurance add-ons explained. If your car is newer, look at zero depreciation cover.
Bonus tips to stay safe
- Keep a digital copy of your policy on your phone.
- Save the insurer's helpline number.
- Keep your RC copy, driving licence and ID proof ready.
- Check your insurance status often. You can use the vehicle number on the insurer's website or app, or the Vahan / Parivahan service.
- Protect your No Claim Bonus by renewing on time.
A quick checklist
- Is my policy valid today?
- Is my IDV fair?
- Did I give true details?
- Do I know my exclusions?
- Do I know how to report a claim?
- Are my add-ons useful for me?
- Is my renewal date saved?
If you answer yes to all, you are in good shape. If not, fix the weak points now. You can get a quote and our team will help you check your cover.
Insurance rules and policy terms can change, and each insurer has its own conditions. Your policy document is the final word on what is covered.
FAQs
What is the biggest car insurance mistake?
Letting the policy expire is one of the biggest. It leaves you uninsured, can mean a fine, and any claim in that time will be rejected.
Can hiding a fact cancel my claim?
Yes. Wrong or hidden facts are a common reason for claim rejection. Always give true and complete details.
Should I report a small claim?
It depends. A claim in the year means you lose your NCB for that year. For very small damage, some owners choose to pay themselves. Think about the repair cost and your NCB before deciding.
How can I avoid mistakes at renewal?
Check your IDV, review add-ons, give correct details and renew before the expiry date. Compare plans before you pay.
This guide is for information only. Rules and policy terms can change, and the policy document is final. Please read your policy wording.