Can service providers deny cashless motor claims to policy holders who have not purchased the insurance policy from the dealer (acting as motor insurance service provider)?

Arun Saxena

At the time of buying a new vehicle, your dealer builds in the insurance premium into the on-road price. This is convenient and hassle-free for most of us. But according to a recent BusinessLine study across dealers, it was found that, often, the premium charged to you by the dealer is 40-45 per cent higher than the cost of similar policies bought online. But your dealer may dissuade you from looking at online options and refuse to undertake cashless service if you don’t buy the policy from him. But remember, the policy offered to you is by the insurer. Hence, as long as a particular service station/garage is listed under the policy for cashless facility, you cannot be denied services.

To regulate the role of automobile dealers in distributing insurance products, the IRDAI notified the guidelines on MISP in 2017. The sponsoring entity is responsible for all acts of omission and commission of the MISP.

So, if you have any complaints, you can approach the insurer who is accountable for the MISP/dealer that sold you the policy in the first place.

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