What type of car insurance can protect against flood damage? | News explained

Water entering cars can damage the engine, electrical systems and interiors. Repairing such flood-damaged cars can put a heavy financial burden on owners. Although there are numerous auto insurance plans and add-ons available in the market, care should be taken while choosing the right car insurance coverage that can protect against flood-related damages.

How can floods damage cars?

Water ingress can lead to serious problems such as engine failure, damage to electrical and electronic systems, rust and odors. Excessive exposure to water can also lead to gearbox malfunction. When water gets into a parked vehicle, it can also damage the interior of the car – seats, dashboards, etc. Some of these problems are immediately apparent, but some may appear over a period of time.

Do all car insurance policies cover flood-related damage?

“A comprehensive policy covers all types of accidents due to fire, flood and theft,” said TA Ramalingam, Chief Technical Officer, Bajaj Allianz General Insurance.

Comprehensive car insurance policies provide coverage for flood-related damage, subject to depreciation based on the age of the car. For all plastic and rubber parts, a 50% depreciation applies, meaning that only half of the total repair cost will be reimbursed and the policyholder will have to bear the balance amount.

However, a standalone comprehensive car insurance policy may not protect against all flood damage.

Can an insurance company deny flood damage claims?

Although the basic comprehensive car insurance policy provides coverage for all flood-related damages, insurance companies may refuse to reimburse if there is damage to the car due to the intentional act of the driver.

“If your car is parked in a basement and it drowns, and you report it directly to the insurance company and have it towed to a service center or garage, then there is no problem. But if you try to start the car after it has stalled, then your engine will go into hydrostatic lock. In that scenario, the insurance company will not cover engine failure because it is consequential damage due to a deliberate act,” said Nitin Kumar, Business Director – Motor Insurance, Policybazaar.com.

A hydrostatic lock occurs when the car’s engine comes into contact with water. Engine damage occurs when water enters a running engine. If the engine does not run and water gets in, then there may be no damage, but it is advisable to get professional help before starting the engine.

What types of car insurance should you choose?

With changing weather patterns, unplanned development and inadequate drainage systems, many cities are unprepared for extremely heavy rainfall and the resulting flooding.

When purchasing a car insurance coverage, you should consider these increasing instances of heavy rainfall. Along with a standard comprehensive car insurance plan, you should go for additional coverages like zero depreciation and engine protection coverage.

“We advise all our customers not to start their engines when stuck in an area of ​​water. The moment you start the engine and water enters, it gets blocked and damaged,” said Ramalingam.

In a stand-alone car insurance plan, engine damage due to water ingress is not covered, but if someone takes out additional cover for engine failure, they can claim a significant amount of repair costs, he said.

One can also opt for consumables coverage that protects against costs incurred in replacing engine parts, including engine oils and lubricants.

Other extras include roadside assistance, key and lock cover and lost personal belongings.