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Motor insurance claims: what policyholders often get wrong
Mint 36 min ago·10 Sept 2026, 9:47 am
Policyholders frequently face claim rejections or reduced payouts because of overlooked procedural errors. Common mistakes include submitting an expired driving licence, failing to report the accident to the police immediately, or not disclosing crucial details like the exact location of the incident. Additionally, many drivers do not verify if their policy includes specific add-ons, such as zero depreciation cover, which are essential for covering the full value of a new car.
This matters to investors because a high frequency of rejected claims can negatively impact the profitability and operational efficiency of insurance companies. When claims are denied, the insurer saves on payouts, which can boost short-term profits. However, if the rejection rate is too high due to poor customer service or policy design, it may lead to reputational damage and lower customer retention.
Investors should watch for quarterly updates regarding claim settlement ratios and the number of pending claims. A rising number of rejected claims might signal internal issues, while a stable or improving ratio suggests the insurer is managing its risk portfolio effectively. Monitoring these metrics helps gauge the long-term financial health of the insurance sector.
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