These deductibles i.e., Compulsory Deductible and Voluntary Deductible are stated in IMT 22 and IMT 22A. You may be wondering what is this IMT. It stands for India Motor Tariff. I will discuss about IMT later.
The word deductible as described in the policy conditions in this manner:
The Company shall not be liable for each and every claim under Section -1 (loss of or damage to the vehicle insured) of this Policy in respect of the deductible stated in the schedule.
Our great Insurance Companies and the Regulator have not defined the word deductible anywhere in the motor insurance policy. So much so they started confusing the policy holders, lest the policy holder may ask a question tomorrow. It is said: ‘if you cannot convince the confuse’! This is yet another classic example of lack of insurance education both for the Insurers and the Regulator.
Liberty General Insurance Company (for example) uses the words Compulsory Deductibles and Voluntary Excess in its Motor policy schedule. What are these people? What should you call them? In the entire Motor policy wording the word Excess is not found. From where have they bought this word? I think whatever they are doing is very much excess!!
Reliance General Insurance Company (for example) has gone one step ahead. They used 3 words in their policy schedule. Two words are, of course, stated in IMT 22 and IMT 22A. They invented one more word called Additional Compulsory Deductible! We the policy holders have no notion of the idea of the word and function of Deductible and how or why it is related to the premium. Look at their creativity… to have come up with Additional Compulsory Deductible.
If this is the game that is being played by the private insurance companies, the public sector insurance companies are not lagging behind at all. National Insurance Company, for example, uses the word in the policy schedule – Compulsory Excess! Of course, the phrase Compulsory Excess is nowhere to be found. There is only Compulsory Deductible.
The words Excess and Deductible are very much different. They may appear same but are drastically different. The difference between these two words is the same as the difference between the sky and earth. Yet, our insurers without any notion doing their best to cheat the policy holders. The insured has absolutely no notion as to what Excess is and what are its functions. The same holds true with Deductible. Using these words interchangeably and using these words without any reference to policy document i.e., policy wording is a culpable crime which that is jointly committed by the Insurance companies and the Regulator.
I am a poor man. I take motor insurance policy because I have no other option. What the Regulator and the Insurers are doing is exploiting my ignorance and making millions of dollars in profits while denying genuine claims. I say one must be a fool to take a motor insurance policy. Do I need to prove it?
About the Author
Dr. K. Raja Gopal Reddy is a seasoned internationally qualified Insurance professional.
What you are reading here, may not answer all the questions we have, but has the absolute power of asking unsettling questions which increase the interest in the strange world, and show the contradictory wonders lying just below the surface of the commonest things of life. Look at this disturbing but beautiful thought of Friedrich Nietzsche “God is dead. God remains dead. And we have killed him”.
Dr. Reddy can be reached at: raja66gopal@gmail.com
