Generally, vehicle insurance companies do not like to upset customers or have a bad name for avoiding claims. However, this does not mean that they will pay every time. Coverage terms and conditions clearly state the circumstances in which they will not make any payment for losses. These limitations are commonly inserted within most policies sold in the US. You will probably see the rationale behind them after considering the fact that they serve to keep premiums low.
First one is to cause the loss knowingly. Insurance is always for unexpected occurrences coming about out of policyholders’ control. This includes losing control of the vehicle before the crash. However, it does not cover getting a baseball bat and smashing it to your heart’s content, no matter what caused the rage. It is the same for any deliberate damage caused by family members, as they are considered part of the package.
On the other hand, you would be paid if a ball hits the car and breaks the windshield, providing you have a comprehensive package. The secret is that one is within your control and you cannot do anything about the other. This distinction is very clear and important.
Secondly, you will not be paid for damages you suffer while you were using the car for a criminal activity. It would be ironic to get smashed while you were escaping a bank heist and come back and claim for the damages. Any illegal activity involved with the car can void the policy. This means that in such cases, you will be treated as if you never had it.
Third exclusion is causing an accident when you are drunk. Being intoxicated is a condition you bring upon yourself. Although it can be treated like an illness, it is not. Obviously, it is nobody’s business that you consume alcohol until you decide to drive. You will have to meet all the costs out of pocket in such cases.
Furthermore, many carriers may cancel the cover from inception as soon as they know you got involved in an accident or received a traffic conviction for drunk driving. This will make it harder to find agreeable car insurance rates from alternative providers either for about five to seven years, depending on the state you live in.
Being insured does not take away the usual responsibilities of car owners. They will still have to look after them and make sure that they stay out of harm’s way. Deliberately leaving it under danger will risk the vehicle and the coverage. They can investigate any claim and when they find gross negligence, they can refuse it. For example, leaving an automobile on a sketchy road with the keys on ignition is asking for it and this choice may not be received well when you report it stolen.
There are two key reasons for it. One is the possible frauds and attempts to get paid for a car that has somehow lost its value. The other is; it is against the logic of insurance provision to pay for the losses that the policyholder did not do enough to avoid. People cannot neglect their duty to protect them in the expectation that they will be compensated whatever happens. That is why it is made clear that people should not assume absolute coverage.
Also, mechanical and electrical failures aren’t the concern of a typical auto insurance policy. They are expected incidents and risks that come with vehicle ownership. There are other provisions to handle such issues like warranties. In addition, some insurers offer Mechanical Breakdown Insurance that can be bought as an add-on future to full coverage. It is fairly cheap to buy but you may have to start early.