How much flood damage will a regular comprehensive car insurance cover? – Economic Times

September 12, 2022 by No Comments

The torrential downpour in Bengaluru has flooded arterial roads, posh apartment complexes, and homes. The general insurance companies have already started receiving claim intimations for the damage to vehicles due to the flood.

If your vehicle has been damaged or submerged due to floods, here is what you need to know about what is covered under a regular comprehensive car insurance policy and the claim-settlement process.

A regular comprehensive car insurance policy without any add-ons like engine-protection rider, only covers the losses caused by natural calamities such as cyclones, lightning, earthquakes, landslide, floods, hurricanes, storms, typhoons, and inundation. Any consequential loss due to natural calamity is not covered. For example, car engine failure due to entry of water in the engine is considered a consequential loss.

Extent of damage to car due to flood
A car may be submerged up to the bumper level or up to the dashboard or up to the roof in a flood. If water reaches the bumper level of your car, the damage will be minimal; it could be repaired by a mechanic without much complication. If the car is submerged up to dashboard or roof, you will need to call the insurance company immediately and inform them about the details of the damage. In both cases, the engine, electronic control module (ECM), upholstery, electronic parts and all lights of the vehicle could be damaged, said Susheel Tejuja, Principal Officer, Founder, and Managing Director,

What should an owner do if his/her car has been submerged?
“Don’t start the vehicle post receding of the flood waters as it may damage the engine,” said Nitin Deo, Chief Technical Officer, Edelweiss General Insurance.

Car insurance policyholders need to provide relevant documents to the insurer for the claim settlement process. So, click several photos or videos of your submerged car and keep them handy, suggest insurance companies. You need to submit detailed pictures of the vehicle to show the extent of the damage.

How much of the damage will your regular comprehensive car insurance policy cover?
If you have a regular comprehensive car insurance policy, each part of the vehicle will be covered under it, said Deo. However, this is subject to the exclusions and conditions mentioned in the car insurance policy. For example, standard comprehensive policy does not cover engine failure due to water logging,it as it is considered as consequential loss, according to Animesh Das, Senior Director, Motor Underwriting at ACKO.

In case of damage due to floods, the insurance companies usually offer protection for two scenarios: a)

The car is washed away b) The car has been affected by water ingress wherein water enters the internal

parts and/ or the cabin of the vehicle, thereby causing damage, explained the experts.

“The compensation depends on the condition of the old(used) car and the years of use,” mentioned Das.

“If the cost of repair exceeds 75 per cent of the insured declared value (IDV) of the vehicle, it will be

designated under total loss as listed in the policy,” Tejuja explained.

The insured declared value or IDV for a brand-new car is taken as 95 per cent of the showroom price of

the car, 80 per cent for a one-year-old car, 70 per cent for a two-year-old car, 60 per cent for a three-

year old car, and so on, according to a standard chart. The car value depreciates by roughly 10 per cent

every …….



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