Lessons from Mumbai rains: Claiming insurance for monsoon-damaged cars

Don't drive if water level rise above tyres. Park the vehicle at a safe spot and call the insurer

Engine seizure is among the common claims during monsoon. It’s also one of the most disputed, as insurers outright reject all cases where the water enters the engine and damages it. But if you take adequate caution, there’s hope.

When driving through a flooded area, water can enter the engine from the air intake system, seizing it. It is also called as the hydrostatic lock. It usually happens when a driver tries to restart the car multiple times after the water has entered the engine. But in certain cases, it can also happen when the car is moving through a water logged area. Insurers, however, reject all claims pertaining to hydrostatic lock citing that the customer was negligent and damaged the engine trying to restart it.

“If the seizure happens when driving through a water logged area, it’s an accident. Insurers need to reimburse the cost of repair. But if it happens because the customer tried to start the car multiple times, it’s negligence. But it’s not possible to establish whether the hydrostatic lock is an accident or negligence,” says an official with a general insurance company.

In the past, consumer fora have ruled in favour of the individual who has proven that he took adequate caution once the car stopped in a water logged area. “Whenever a person is traveling through a flooded area and the water is above the tyre level, he should get out of the vehicle and park it safely. If the car stops for any reason, the driver should not try to start it,” says Parag Gupta, chief underwriting officer, Bharti AXA General Insurance.

One should then wait for the water to recede. “Call up the insurer. Inform the company that your vehicle was submerged in water and ask for the process to follow,” says Tarun Mathur, co-founder and director, Policybazaar.com. Most likely, the insurer would arrange for the car to be towed to the nearest garage and have it inspected.

As engine seizure can lead to disputes, most insurers advise that it’s always better that a customer should get an add-on cover that protects engine damages. “The add-on cover comes at a nominal cost and includes all kind of damage to the engine. It protects the buyer from consequential damages, too,” says Parag Ved, executive vice president–consumer lines, Tata AIG General Insurance.

If your car was parked and water entered inside the cabin, follow the same procedure and call up the insurer. Do not start the vehicle immediately after the water has receded. Let it dry for a day or two. Besides engine seizure, there’s a possibility of failure of electrical equipment. Water can cause a short circuit or even start a fire in the car. The insurers, however, do not dispute any electrical failure and reimburse the claim.

Except for taking caution with engine and electrical, an insurer would pass the relevant claim for any other damage to factory fitted equipment. “Factory-fitted does not include the components that your dealer would have offered you after the car reached the showroom. If you upgraded audio systems, got a reverse parking sensor later, added extra speakers from the dealer, etc; all these equipment would not be covered unless you had declared them to the insurer when filling up the form,” says Atrey Bhardwaj, category head, general insurance, BankBazaar.com.

Bhardwaj points out that most individuals don’t realise that they need to inform the insurance company of any additional fitting they do, which can be easily covered.