Why Car Key Replacement Insurance Cover Is Important?

Why Car Key Replacement Insurance Cover Is Important?

Car keys have evolved from their traditional form to remote keys and FOBs or Frequency Operated Buttons. When you lose these keys, they need to be replaced through an authorized OEM (Original Equipment Manufacturer). For high-end car models, the replacement costs can be high. Hence, many insurance providers offer a Key Replacement add-on cover to help car owners get a replacement key with a small increase in the car insurance price.

When you buy comprehensive insurance for a car, it is recommended to compare Car Insurance and consider the coverage, add-on covers offered, and premium amounts. This can help ensure that you get the best plan for your car. Add-on covers help customise the policy to your needs and ensure that you get extensive coverage on your car. One such add-on is the Key Replacement Cover.

Different Types of Car Keys

There are three broad categories of car keys:

  • Manual: These are the traditional keys that have been used since the introduction of cars. While these keys are slowly getting obsolete, they are still used by some car manufacturers.
  • Remote: With remote keys, you need to push a button to unlock the car. They also have a turning mechanism for emergencies
  • FOB: Frequency Operated Buttons or FOBs are keyless ways of unlocking and starting your car.

Remote keys and FOBs are programmable keys. The manufacturer uses software to program the key and the lockset. Hence, if you lose the key, the OEM has to reprogram the lockset and the new key of your car. Hence, getting a replacement key can be costly.

What is a Key Replacement Cover?

If you lose your car keys, then the replacement cost can be high if it is a remote key or a FOB. Many insurers offer a car key replacement insurance cover that reimburses the cost of getting the key replaced in the event of a loss. 

Most high-end car models offer a substitute key that you can use if the original is lost. Many car owners tend to use this key and forget to replace the original one. This can cause problems when they file a claim since most insurers insist on original car components (including the key) for processing claims.

Inclusions and Exclusions of Key Replacement Cover

When you opt for a car key cover insurance, the insurer will reimburse, up to the sum insured in the policy, the costs associated with key replacement. The cover is valid if your key is lost, stolen, or damaged. Some insurance companies also compensate for repairing the lockset if it is damaged or stolen.

Here are some scenarios where the claim for key replacement can be rejected:

  • If the key was damaged intentionally or with criminal intent
  • Many car manufacturers offer warranties that cover the loss or damage of the key. In such cases, the insurer will not honour the claim.
  • Car owners are required to submit the invoice/bill of payment made towards key replacement/repair charges. Failure to produce these documents can result in the rejection of the claim.
  • This add-on usually does not cover damage due to exposure to hazardous materials, radiation, or contact with toxic or corrosive substances.

How does the Key Replacement Cover Work?

Here are some basic steps that you need to keep in mind to avail of reimbursement under the Key Replacement Cover:

  • If your key is stolen, then you need to file a report with the police and obtain an FIR
  • Inform your insurer about the loss, damage, or theft of the key
  • Get a replacement key and keep all the bills and invoices safely
  • File a claim with the insurer and submit the required documents

Remember, most insurers have a stipulated time frame within which you need to file a claim after losing the key. This is usually around 30 days. Make sure that you check with the insurer if filing a claim for key replacement resets your No Claim Bonus or not. 

Summing Up

A comprehensive motor car insurance policy offers a wide range of add-ons to ensure that you get maximum coverage. The Key Replacement Cover is particularly beneficial for high-end cars as the cost of repair or replacement can be very high. Hence, when you are buying a Car Insurance policy, make sure that you look for this add-on cover. You can also include the cover at the time of car policy renewal. The process to renew a car insurance policy has become simple and quick in the last few years.