How to Verify if Your Car Insurance Policy is Fake?

Insurance fraud in India amounts to almost 8.5% of the total revenue generated in the insurance sector. Apart from inflated claims, fake policies are one of the leading causes of insurance frauds in auto insurance . The Finance Minister of India has announced that around 1,192 fake policies were sold in 2018-2019. How do you identify a fake car insurance policy ? Here is a guide.

Third-party car insurance is mandatory by law. Before you purchase such a policy, you must verify the genuineness of the policy distributor. Each auto insurance policy distributor must have a valid Motor Insurance Service Provider (MISP) license. When you buy a third-party car insurance policy from a dealer find out their license number and check whether they are registered in the IRDAI website.

First, check for the existence of the policy online. Next, when you get your policy number, visit the website of the insurance provider and enter the policy details. If your policy is genuine, details of your vehicle like the model, registration number and the exact cover will be displayed. You can also get in touch with the insurer’s customer service department via their toll-free number to verify the details.

Every car insurance policy sold in India must have a QR code as mandated by IRDAI . Scanning the QR code with a QR reading app on your smartphone will reveal the status of your policy. Details like the cover note number, the exclusive identification for your policy, will show up. It will help you verify the authenticity of your policy.

Your policy document should bear the shimmering 3D logo of the insurance provider on the official stamp of the company. Without the official stamp and logo, the insurance policy is void.

1. Buy directly from the insurer: Avoid buying from agents, they may give you a fake policy and pocket your money. Visit a branch office of the company or their official website for purchasing the policy.
2. Make payments with a cheque or a credit card: Do not make any cash payments, use a cheque or digital money transfer to ensure the amount goes to the insurance provider directly. You will also have a record of the payment this way.
3. Collect every receipt: Do not neglect to procure the receipt every time you pay the premium. It will help in filing a lawsuit in case of any fraud.
4. Read the policy document: Confirm whether it correctly mentions information like Insured Declared Value (IDV) , deductibles and No Claim Bonus (NCB) and your name and address. Immediately notify the insurer of any discrepancy.

The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.