Motor insurance: Prioritise 'engine protect' rider this monsoon season

Standard motor insurance covers many monsoon-related losses, but add-ons such as engine protect and zero-depreciation can significantly reduce out-of-pocket expenses

The monsoon exposes motor vehicles to flooded roads and waterlogged parking areas. A vehicle may stall in deep water, and flooding can damage the engine, body, interiors and electrical parts. A standard comprehensive motor insurance policy covers many of  these losses, but not all of them. Vehicle owners need suitable add-on covers to protect themselves more fully against monsoon-related damage and the resulting out-of-pocket costs.

 

Understand the base cover

 

A comprehensive policy covers damage caused by floods, inundation and water ingress following heavy rain. It also covers damage caused by cyclones, storms, hurricanes, typhoons, tempests and hailstorms. The cover also extends to landslides and rockslides triggered by heavy rainfall, and to trees or branches that fall on a vehicle during a storm. “If floodwater damages the vehicle’s body, electrical systems, upholstery, or other insured components, the insurer will generally pay for repairs, subject to policy terms, depreciation (unless waived), deductibles, and the insured declared value (IDV) in case of a total loss,” says Shilpa Arora, co-founder and chief operating officer, Insurance Samadhan.

 

Know the exclusions

 

The standard policy excludes mechanical or electrical breakdown that an insured event did not directly cause. It also excludes normal wear and tear, corrosion or rust, and consumables, unless an add-on covers them. “Depreciation of up to 50 per cent may apply to parts according to the defined schedule,” says Pradeep Funde, senior vice president, Anand Rathi Insurance Brokers.

 

Arora adds that insurers may exclude damage caused by knowingly driving through deep water, depending on the facts and policy wording.

 

Restarting a submerged vehicle can cause engine seizure or hydrostatic lock. “A standard comprehensive policy treats this as a consequential loss and excludes it, unless an add-on specifically covers it,” says Sandeep Saraf, motor insurance renewals, customer experience & claims, Policybazaar.com. 

 

Starting a submerged car is a major cause of claim denial. “Insurers regard such an attempt as an act of negligence,” says Kapil Mehta, co-founder, SecureNow Insurance Broker.  

 

Add-ons you need most

 

Engine protect should be the first priority for monsoon-related risks. “This add-on covers consequential engine damage due to water ingress, hydrolock, lubricant leakage, and damage to engine components that would otherwise be excluded,” says Arora.

 

A zero-depreciation add-on reduces the policyholder’s out-of-pocket expense by covering depreciation on replaced parts. “It allows the policyholder to receive the full claim value for such parts,” says Mehta. It is particularly useful when several plastic, rubber or fibre components suffer damage.

 

Consumables rider pays for engine oil, coolant, filters, nuts, bolts and clips that a standard claim often excludes. These items often form a substantial part of the claim amount.

 

Roadside assistance provides towing and emergency support when a vehicle is stranded. “Most motor policies generally include this facility, so check the base policy before paying for a separate roadside-assistance add-on,” says Mehta.

 

Return-to-invoice cover pays the vehicle’s invoice value in the event of total loss or theft.

 

Protection for an electric vehicle

 

Flooding poses additional risks to an electric vehicle (EV). High-voltage batteries are vulnerable to water ingress and prolonged exposure during severe flooding. “Water ingress can cause electric motors and power electronics to fail. It can damage onboard control units and sensors, and corrode electrical connectors and wiring,” says Saraf.

 

Funde informs that some policies depreciate a high-voltage battery by 50 per cent if the policy does not include it in the IDV. 

 

Consider purchasing a battery-protection cover. “Battery-protection cover, charger cover, and charging-cable cover are a must for an electric vehicle,” says Funde. These covers are required in addition to conventional-car add-ons.

 

Never switch on or charge a submerged EV as doing so can damage the battery and inverter. Do not plug it into a charging station after exposure to flood water until an authorised service centre has inspected and certified it. If the vehicle emits a hissing sound or smoke, inform the fire brigade. Park such an EV in an open space, not in a basement.

 

A few dos and don’ts

 

Switch off a flooded vehicle immediately and do not start or restart the engine. “Attempting to restart the vehicle after submersion can lead to claim rejection,” says Saraf. Exit the car. If possible, move it to a dry location without turning on the ignition and disconnect the battery.

 

Inform the insurer immediately. “Delaying claim intimation without a valid reason can lead to claim rejection,” says Saraf. Before any repair begins, take photographs and videos of the vehicle, the water level, the surroundings, and any visible damage. This evidence will assist the surveyor’s assessment and can help if a dispute arises.

 

Arrange towing through the insurer or roadside-assistance provider. Do not let repair begin before the insurer’s surveyor has inspected it, as this can affect the claim. 

 

Use an authorised garage whenever possible. “An authorised garage can facilitate a cashless claim,” says Arora. 

 

Keep the registration certificate, driving licence and other documents ready for making the claim. Retain every invoice and repair-related record in case you need to file a reimbursement claim. Finally, provide correct and complete information while filing the claim.