covers your car against risks like theft, accident, explosion etc.
When you have spent lakhs possessing your dream car, why would you not shell out a few hundred more to safeguard your asset? That is a simple car insurance This will not just cover your vehicle but safeguard your family in case they happen to be in the vehicle.
But, wondering what happens in case your life time possession gets stolen? The most important point here is to have the right car insurance. Let me explain further. There are two types of car insurance:
This covers only the death/injury and property damage of third party only. It also covers the Accident cover of the driver. This insurance is compulsory by the Government of India.
Along with the third party, this insurance covers loss or damage to the owned vehicle too.
So, to begin with, you need to have the right Policy which in case of stolen car would be a comprehensive policy or third party insurance with a rider covering theft too.
Always remember to file an FIR at the nearest police station. This is the most important step to begin with. Even the insurance company with which you are Insured will not process your Claim till you have filed a police report.
Then, once you have a copy of the police report, you must inform your insurance company about the same. A claim form needs to be downloaded or retrieved by the insurance company and filled. Informing both the police and your insurance company will prevent you from legal hassles in case the thief has injured other people while driving your vehicle. At the same time, do give all the details of your car loan. This will help the insurance company to directly negotiate and pay off any future EMI’s to your bank. Basic details of the car like number, colour, mileage, and model must be provided to the insurance. Alongside, in case there were any personal belongings, do let the insurance company know.
Simultaneously, it is always advisable to inform your banker and regional transport officer about the theft.
All what is discussed above is majorly what you need to do once your vehicle gets stolen. Now, there could be two outcomes;
One, in case the police recovers your vehicle and informs you:
Then you need to inform the insurance company so that it compensates you for the damages caused to the car. If your policy covers for stolen items, then the insurance company is liable to cover you for the same.
The police will give you a Non traceable certificate which has to be submitted to the court. In this case, remember you will never get the whole amount back that you spent to buy your car. The settlement will always be on the Insured Declared value. The chart given below will provide better details for you. For example: If your vehicle gets stolen in 2 months of purchase, you are eligible for 95% of value at which you bought the vehicle.
Vehicle’s Age % of Depreciation
Not exceeding 6 months 5%
Over 6 months -Less than 1 year 15%
Over 1 year – Less than 2 years 20%
Over 2 years - Less than 3 years 30%
Over 3 years - Less than 4 years 40%
Over 4 years - Less than 5 years 50%
Thus, once you submit the claim form, car registration certificate, original and copy of first information report , car keys (if you have the other set) and a no trace report confirming the vehicle is not found, the insurance claim process gets started.
It may look very tedious and lengthy on the whole but not having one, will surely burn a deep hole in the pockets in case of theft. Thus, it is advisable to have a comprehensive policy or a policy with an attached rider covering theft.