homepersonal finance NewsKey things to know about emergency hotel accommodation cover in car insurance

Key things to know about emergency hotel accommodation cover in car insurance

Key things to know about emergency hotel accommodation cover in car insurance
Read Time3 Min(s) Read
Profile image

By CNBCTV18.com Contributor Oct 6, 2022 4:15:00 PM IST (Updated)

This cover can safeguard the owner and passengers travelling in a vehicle, in scenarios where the vehicle faces an accident or is stolen at a location far away from the registered address.

With health and safety concerns motivating more Indians to purchase a four-wheeler for personal transport, it has become even more important to understand the intricacies of car insurance.

Recommended Articles

View All

While it is advised to complement a car purchase with a comprehensive car insurance cover, there are add-on covers like Emergency Hotel Accommodation which can be extremely beneficial in specific situations.
Let us look at how
This cover can safeguard the owner and passengers travelling in a vehicle, in scenarios where the vehicle faces an accident or is stolen at a location far away from the registered address.
What benefits does an Emergency Hotel Accommodation add-on provide?
Imagine you are on a road trip or travelling to a destination with your loved ones and your vehicle meets with an accident that deems it inoperable. The first thing on your mind would be to secure yourself and the vehicle’s occupants, especially if the accident occurs at night or in a secluded area.
In such circumstances, an Emergency Hotel Accommodation add-on cover provides you with the benefit of covering hotel stay expenses for the vehicle’s occupants, till the time the vehicle is recovered safely and transferred to the
insurer’s authorised network garage for further repairs. The same assistance is applicable if the vehicle is stolen from a place that is away from your base location and you need to safeguard your co-travellers while you report the incident to the nearest police station or complete any other formalities.
When does this cover come into effect?
Designed to provide peace of mind and offer support in difficult situations, an Emergency Hotel Accommodation add-on cover is usually accompanied with certain conditions that are clearly stated in the policy document. Depending on the insurer, a minimum distance is applicable from the insured’s registered
address beyond which if any accident or theft incident occurs, the insurance company will make an allowance towards hotel accommodation of the insured.
This allowance is meant to pay for the cost of overnight stay and is provided during the OD policy coverage period. Additionally, it is important for the insured to maintain documentary evidence of the expenditure in the form of a hotel tax invoice and needs to be submitted to the insurance company for further payment processing. However, if for any reason the insurance claim is deemed to be invalid or inadmissible by the insurance company, the same treatment will be extended to the Emergency Hotel Accommodation add-on cover as well.
How much does it cost to include this cover in your car insurance policy?
Unlike most add-on covers that are linked to the Insured Declared Value (IDV) of the vehicle, an Emergency Hotel Accommodation cover is priced depending on the maximum amount of allowance that the insurer will be liable to pay towards hotel stay expenses. This amount is clearly stated in the policy document, along with the additional premium associated with it. It is highly recommended to include this vital add-on cover to ensure complete peace of mind for yourself and your family members when travelling together on a vacation or to far-away destinations.
The author is Rakesh Jain, CEO at Reliance General Insurance (RGI). The views expressed are personal
Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!

Top Budget Opinions

    Most Read

    Market Movers

    View All
    Top GainersTop Losers
    CurrencyCommodities
    CompanyPriceChng%Chng