Common reasons for not receiving a payout on your commercial vehicle insurance claim:
Facing an accident or damage to your vehicle is a stressful affair for anyone. This difficulty is particularly acute for those commercial drivers who depend upon their vehicle for their livelihoods. Insurance provides the reassurance that, in these unfortunate circumstances, you will have the necessary financial support to get back on your feet. Hence the rejection of a claim can be a disheartening and sometimes confusing experience.
Incorrect Information and Non-Disclosures
When applying for your policy, it is important to ensure that you answer all of the questions carefully and honestly. Incorrect information is one of the leading reasons why an insurance company might reject your claim.
For example, if your policy documents state that your vehicle is kept in a garage overnight and there is no garage at your property, you would not be eligible for a payout if your car was stolen or damaged overnight.
Other factors that are often misrepresented or undisclosed include:
- Home Address
- Value of the vehicle
- Annual mileage
- DVLA notifiable medical conditions
- CCJs/bankruptcy
- Motoring Convictions
- Criminal Convictions
- Claim history
- The policyholder not being the registered owner/keeper of the vehicle
Mid-Term Adjustments
As well as making sure all of your details are correct at the inception of the policy, you must make sure that they are kept up to date throughout the policy’s duration. A change of vehicle is the most obvious example of an adjustment you would need to inform your insurance company of. In addition, modifications to your current vehicle or a change to your home address, for instance, may result in a rejection of your claim if you fail to notify the insurance company.
Vehicle Usage
Your vehicle is only covered by your insurance if it is being used for the purposes stated in the policy. If you are a taxi driver, you may wish to use your vehicle for other commercial purposes, such as courier work or food deliveries. Although some insurance companies will offer this as an addition to your policy, it is vital that you declare this pre-inception. Failure to do this will result in a refusal of your claim, should it become evident that you were using the vehicle for other reasons when the accident occurred.
Fraudulent Claims
When we hear the term ‘fraud’ with regards to vehicle insurance, it is natural to think of the vehicle dumping and ‘crash-for-cash’ practices that have arisen as a means of financially benefitting from your insurance. Exaggerating the damage costs to your vehicle is one example, another is the practice of ‘fronting’. Fronting refers to the false declaration of an individual (say, someone with a better claims history) as the main driver on the policy in order to lower the cost of the insurance. Not only is this unwise as it invalidates your claim, but it also a criminal offense.
Claims Process
How quickly you are required to report an incident will vary depending on your insurance company. Twenty-four hours is the usual timeframe for filing a claim, anything over this can incur additional excess charges. So it is important to be aware of your company’s individual claims process. The best thing you can do to ensure your claim is valid is report it as immediately as you can.
Unsuitable Coverage
The type of coverage you have will impact upon whether or not your claim is viable. There are three types of cover you could have on your policy.
- Third Party Only (TPO): This is the minimum level of cover necessary for all drivers in the UK. In the event of a fault accident, your insurance company would be liable to cover the cost of damages to the third party vehicle or injuries to other persons involved. Damage to your own car, however, will not be payable by the insurance.
- Third Party, Fire and Theft (TPFT) : Similar to TPO, with TPFT cover your insurance company cannot cover the cost of damages to your own car in a fault accident. However, it has the additional benefit of protection should your vehicle be stolen or damaged by fire.
- Fully Comprehensive: This is the highest level of cover possible. With fully comprehensive insurance, damages to your vehicle are covered regardless of fault.
Your coverage must also be valid at the time when the incident occurred. If you are driving the day before your policy is due to start, or after the policy has lapsed, you will not be covered for ay incidents that occur during this time.
When applying for your policy, some insurance companies may ask you whether you drive exclusively between specific hours of the day (commonly 7:00am-11:00pm). If you answer ‘yes’ to this question, then you will not be able to claim for accidents that occur outside of these hours.
Licensing
It goes without saying that anyone operating the vehicle must have a full UK license, but depending on the specificity of the vehicle you may also require additional licensing categories. One instance in which this is relevant is the operation of minibuses. If you are driving a 9-16 seater vehicle, you must have obtained the necessary D1 category on your license, else your claim will be void.
Lack of Due Care
As a policyholder, there is a certain level of personal responsibility you must uphold to avoid claims. If an incident is deemed to be a consequence of the individual’s negligence, it is possible for the insurance company to deny payout. This could refer to, say, leaving the vehicle unlocked or the car keys in the ignition in the event of a theft.