Introduction Floods can cause extensive damage to vehicles, leaving car owners with hefty repair bills. However, having a comprehensive car insurance policy can provide financial protection in such situations. In this article, we will explore how a regular comprehensive car insurance policy covers flood damage and the claim settlement process. We will also discuss the extent of damage caused by floods and what car owners should do in case their vehicles are submerged.

Understanding Comprehensive Car Insurance Coverage

Comprehensive car insurance is a type of insurance policy that provides coverage for a wide range of risks, including damage caused by natural calamities like floods. It typically covers losses due to cyclones, lightning, earthquakes, landslides, hurricanes, storms, typhoons, and inundation. However, it is important to note that any consequential loss resulting from a natural calamity is not covered under a standard comprehensive policy.

Assessing the Damage

When a car is submerged in floodwaters, the extent of damage can vary depending on the water level. If the water reaches the bumper level, the damage is usually minimal and can be repaired without much complication. However, if the car is submerged up to the dashboard or roof, the damage can be more severe. In such cases, it is crucial to contact the insurance company immediately to initiate the claim settlement process.

Steps to Take If Your Car is Submerged

If your car has been submerged in floodwaters, it is important not to start the vehicle as it may further damage the engine. Instead, take the following steps:

1. Document the Damage: Take multiple photos or videos of your submerged car to provide evidence of the extent of the damage. These will be required during the claim settlement process.
2. Inform the Insurance Company: Contact your insurance company as soon as possible and provide them with the necessary details of the damage. They will guide you through the claim settlement process and provide further instructions.

Coverage Provided by a Comprehensive Car Insurance Policy

A regular comprehensive car insurance policy covers the repair or replacement costs of the damaged parts of a vehicle. However, the coverage may vary depending on the exclusions and conditions mentioned in the policy. For instance, standard comprehensive policies do not cover engine failure due to waterlogging, as it is considered a consequential loss.

In the case of flood damage, insurance companies typically offer protection for two scenarios:

1. Car Washed Away: If the car is completely washed away by floodwaters, the insurance company will assess the condition of the vehicle and provide compensation accordingly. The compensation amount depends on the condition and age of the car.
2. Water Ingress and Damage: If the car has been affected by water ingress, wherein water enters the internal parts and/or the cabin of the vehicle, causing damage, the insurance company will assess the extent of the damage and provide compensation based on the repair costs.

Claim Settlement Process

The claim settlement process for flood damage under a comprehensive car insurance policy involves the following steps:

1. Assessment of Damage: After informing the insurance company about the damage, a surveyor will be appointed to assess the extent of the damage and determine the repair costs.
2. Calculation of Claim Amount: The claim amount is calculated based on the insured declared value (IDV) of the vehicle. The IDV is the maximum amount that the insurance company will pay in case of a total loss. It is usually calculated as a percentage of the showroom price of the car, taking into account its age and depreciation.
3. Deductibles and Compensation: In case of total damage, the insurance company may apply a standard deductible amount mentioned in the policy. The customer will receive the IDV minus the standard deductible.
4. Partial Damage: If the car is partially damaged and the repair costs fall within a certain percentage of the IDV, the claim will be settled on a cash loss basis. The settlement amount depends on the damaged parts and is mutually agreed upon by the insurer and the policyholder.
5. Depreciation Deduction: Regular comprehensive car insurance policies only reimburse the actual market value or depreciated value of the damaged parts. The insurance company will deduct the applicable depreciation amount based on the age of the car and the type of parts damaged.

Paying for Depreciation

Depreciation plays a significant role in determining the claim amount for flood damage under a comprehensive car insurance policy. Regular comprehensive policies typically reimburse the depreciated value of the damaged parts. The depreciation amount varies depending on the age of the vehicle and the type of parts damaged.

For metal parts, the depreciation percentage may range from 10% for vehicles aged up to two years to 50% for cars older than ten years. Plastic parts are usually subject to a 50% depreciation. Therefore, the customer may have to bear approximately 25-30% of the repair costs out of pocket, depending on the extent of damage and the age of the vehicle.

Conclusion

Flood damage can be financially burdensome for car owners, but a regular comprehensive car insurance policy can provide the necessary coverage. By understanding the extent of damage, documenting the damage, and following the claim settlement process, car owners can ensure a smoother process and receive compensation for the repairs or replacement of their vehicles. It is essential to review the terms and conditions of the policy to fully comprehend the coverage and exclusions for flood damage.