Your Car Is In The Garage; Will Your Motor Insurance Pay For Alternative Transport?

A road accident takes only a few seconds to happen. After you file an insurance claim for your vehicle, the surveyor gets appointed. The repairer then gives you a delivery date based on the extent of damage, and for the next several days you have to work out how you'll get around without your vehicle.

Motor insurance is mostly discussed in terms of damage: what type of damage happened, the extent of it, what it costs to fix and how much of the bill the insurer settles. However, the days a person has to spend without the car often gets far less attention. That cost is called mobility downtime. It begins as soon as the vehicle reaches the workshop and continues until the car is handed back. Motor insurance policies have an add-on that typically covers it.

“A Daily Conveyance Benefit add-on pays for alternative transport while an insured car is being repaired after an admitted accidental damage claim. It can be in the form of a fixed daily allowance, or taxi coupons worth the same daily amount. Insurers usually provide a daily benefit of Rs 500- Rs 1,000 per day after the applicable time excess, up to 7-10 days or the number of days mentioned in the policy document. This benefit may vary across insurers,” says Aditya Kumar, Head-Motor Underwriting, Digit Insurance.

The daily allowance you will be provided with under the coverage, the maximum number of days covered and the period before the benefit starts are all mentioned in your policy document.

“This benefit is most useful for people who would struggle to manage without their car; think families with only one vehicle, people who live far away from areas with access to public transport and anyone whose car is used to getting to work. If being without a car for a week would cause real disruption, one should consider opting for this add-on,” says Kumar.

Most car owners plan for repair costs, but few plan for the cost of getting around while the car is at the workshop getting repaired. An add-on like this is meant to cover you from additional out-of-pocket expenses you may incur during this period. One should keep in mind that the benefit typically only applies if the car is repaired at a network garage.

The add-on becomes applicable only after the underlying own-damage claim has been admitted. For repairs, the eligible period is counted from the first loss assessment at the workshop and runs until the car is ready for delivery, subject to the waiting period and the maximum number of days in your policy. In theft cases, it is counted from the date the claim is reported. You can utilise this benefit up to twice in a policy period.

The benefit doesn't apply if the base policy isn't valid or the own-damage claim is rejected. It also doesn't cover losses caused by specified natural catastrophes, riots or strikes, or claims for windscreen or glass damage only.

“Also keep in mind that you can only include this cover at the time of buying a policy or during renewals and not after an accident. Read the policy document carefully, understanding the sum insured and the number of days covered,” advises Kumar.