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Published in Mint on March 15 2016, Written by Abhishek Bondia
My car has a dent on one side. My car insurance is due for renewal next month and when the surveyors came to check my car, they denied insurance saying that I need to get the dent fixed first as I might ask for insurance for this as well. Can they do this?
—Arjit Saxena
The standard practice is for the insurer to take your sign-off on the inspection report. This clearly states the damages that the car already has and these are excluded from insurance. It is not typical of insurers to insist on dents to be fixed first.
This practice has developed because most vehicle owners have a tendency to avoid reporting small damages and accumulate repairs. This also helps protect the no-claim bonus. However, the implication for insurers is that they are saddled with claims that pertain to a period before they took up the insurance.
In your specific case, you should find an insurer that does not insist on repair. In general, it is a good idea to have dents repaired periodically because new insurance companies will not pay for old damages.
Is it true that most health insurance policies don’t cover pregnancy costs anymore? I’m 26 and single and wanted to buy a suitable health cover.
—Rashi Malhotra
Maternity expenses are a standard exclusion in most health insurances. Specifically, individual insurances do not cover maternity costs. However, there are now several health insurance options where maternity costs can be covered. Buy an insurance policy that allows you to add on a spouse when you get married and also covers maternity. Do remember that generally maternity costs are covered after a waiting period. A three- to four-year waiting period is typical, although some have a waiting period of one year.
Maternity costs are often sub-limited. Another point to watch for is whether the newborn baby is also covered in the insurance. It is fairly common for a newborn child to require medical attention. A few plans exclude these expenses or treat them as part of the maternity sub-limits.
What all insurances can I take to cover damage to my clothing showroom from natural calamities? It is my only source of income.
—Sajjan Kushwaha
You should take a standard fire and special perils policy. Other than fire, this plan offers coverage for perils categorised as act of God, such as earthquakes, storms, floods, and lightning. Under the basic cover, you can insure any material damage due to these perils for all tangible assets. The plan also offers flexibility to cover loss of profits due to these. For example, if your showroom needs to be shut while it is being repaired, the insurer would reimburse standing expenses and the gross profit for this period. This enables you to protect not just your assets but also your income.