Saturday, December 3, 2011



While buying used cars the common parameters used by the buyers are 
  • Check the condition of the vehicle 
  • Check for marks which show any major accidental repairs
  • Check for vehicle documents and they should be in order
  • Check for NOC if vehicle registered in other state
Now the more smarter buyers will be taking extra precautions by checking with the NCRB (National Crimes Records Bureau ) by visiting their site at and going to vehicle enquiry at URL  and if the site confirms that the vehicle is not involved in crime or theft it is assumed that the vehicle is a clean vehicle and deals are made.


  • Merely certification from the NCRB will still not be solving the purpose. One should try to be in contact with the original registered owner of the vehicle and if possible should check the registration details from registration authority also. At present some of the RTO's have made the registration data available on their web sites also and one can check the details from the same and same should be matching with the documents being made available by the seller.
  • Do not depend on others and take some preventive steps by yourself . As a negligence by you may land you in trouble.
  • The thieves of cars had become smarter and had been adopting many new means . One of the way out found out by them was to buy a total loss vehicle and by using the registration documents of the totaled vehicle had been planting the chassis number and engine number details on the stolen vehicle .
This above way is most dangerous for the buyers of used cars as unsuspecting customers.In case the vehicle purchased by them is such a vehicle then law enforcing agencies can be knocking on their doors anytime and they will loose the vehicle as same will be taken by the law enforcing agencies and will not be getting back any payments made.Therefore one should take utmost care for such deals as under ;

1.      One should check on the parts of the vehicle like glasses and one will find that in most of the vehicles the year of manufacture and month of manufacture is written on them. The same should be matching with the year of manufacture of vehicle or should be after the year of manufacture if had been replaced due to some accident. Similarly one can find year and month on many parts like wheel rims,Alternator,Compressor etc. Some parts will be having coded dates of manufacturers and one can take help of authorized workshop personnel in finding the details.
2.     One should check the chassis number location closely and check if their had been any sign of welding and re-welding and painting and any suspected vehicle should be avoided.
3.     Thieves take most of the care in tampering with chassis number but engine number marked on the block of engine may be missed by them as same is hard to reach for checking. One should get the same checked at workshop. One should not get confused with the engine number plate as same can be changed easily by thieves. The engine number punched on the engine block should not show any tampering and the digits should be clear and in proper manner in a symmetrical manner.
4.     Engine and chassis number plate in addition to the same also contains the color code of the vehicle. One should note the same and check with the dealers of vehicle and the same should be matching with the color of the vehicle and color of the vehicle mentioned in the registration certificate.
5.     Wheel rims are another place where you can check the year of manufacture of same and match with the registration certificate.
6.     Finally the buyer should do some surfing on the Google search. First put the registration number and search. Then other details like engine number and chassis number . One should try with chassis number and engine number as first complete Alpha numeric numbers and then with last five digits of the chassis number and engine number. The registration number should also be checked in combinations by using - / etc. There is probability that if the reporting had been made on the web for accident of vehicle or some other way you will be getting the information for the same and can decide yourself. If you find some serious matter the same should be brought to the notice of nearest police authorities for them to investigate the matter.
7.     If you are buying the items on used cars web sites then you should first check if they are displaying the registration details on their listing and the details of the seller. You should take a print of the published material on the site before proceeding further.Physical inspection in all cases is must.
Total loss vehicles come in open market for sale by insurance companies and insurance companies publish the tender for the same in newspapers and most of the newspapers are having web presence and data is hosted on web and thereby it is likely that the search of such vehicle may be found on the web.Insurance companies are at present not maintaining the data of all such vehicles settled by them for total loss and also thereby are not sharing the same on web for the common masses in INDIA.

Monday, October 10, 2011


There are reports in news sometimes that the car thieves are sometimes allegedly involved in purchase of Total loss vehicles and using the documents of total loss vehicles in converting stolen vehicles as genuine vehicles.
Suggestions and modes for curtailing such  activity by bad elements are expressed as our views on the matter for a discussion


MV act in India provides that vehicles which become unworthy to ply on road, owner should  inform to the concerned registration authority and  the same will be noted in its books of records and registration cancelled.

General conclusion of same is taken by law enforcing agencies that if a vehicle is declared total loss the owner/ insurance company should thereafter inform the registration authority and get the registration certificate cancelled......... but the situation is quite complex.... Most of the total loss / constructive total loss etc do not recommend that the vehicle can not be repaired again but in all such cases the vehicle stand declared total loss by insurance companies as the repairs cost may be more than the economic liability of insurers in case the same is  declared total loss as other factors like lower IDV of vehicle becomes a major factor.

In advanced countries  .... the system is different ... as for all such declared vehicles as total loss the same are sent to dismantles and they issue certificate to the owner/insurers that the vehicle is properly dismantled and its identification numbers destroyed and also inform the registration authorities for the same. Also if the vehicle is not to be dismantled the same is repaired and they issue certificate that the vehicle has be genuinely repaired and is fit to ply on road and the information sent to Registration authority and after vehicle after repairs passes the fitness test the same is allowed to ply on the road and sale of same allowed.

The same can not apply to the INDIAN condition in our opinion for many reasons .... who will monitor the dismantlers ... the dismantling is not a preferred choice in Indian condition  .... and repairs with used 2 nd hand parts is often preferred and furthermore repairs costs by local repairers are far less than being charged by authorized dealerships and almost all such vehicles are subsequently repaired by local roadside repairers.


At start the genuine salvage buyers should take preventive measures as ...... Whenever they buy a total loss vehicle along with the vehicle documents they should make records as under :

a) In case they intend to dismantle the vehicle completely then they should get the registration cancelled by informing the registration authority and should also deposit the manufacturer's plate with the registration authority and should get certificate for the same from authority.

b) In case they intend to repair the vehicle then the said repairs should be properly recorded and one of the best way is to engage a local surveyor ( Independent Surveyor Loss Assessor) who will inspect the vehicle during its all stages of repairs and will confirm the modes of repairs undertaken and will finally inspect the vehicle after repairs and certify that the same is satisfactorily repaired. The report for same should be obtained and copy of same given to the owner / INSURERS of vehicle also for his/their record. There will be some fee to be born by the salvage dealer for the same but same will be worth the effort. The said final inspection by surveyor will also help you in seeking reinsurance of the vehicle with the insurers. All such records should be properly maintained.

        The insurance companies may also insist for the said practice and may include provisions of same in their tender documents  with provision that at time of delivery of salvage only the salvage will be delivered with certificate for such delivery . Now and if buyer opts for mode
 (a) the RC will be sent to registration authority for cancellation of RC. and in case opts for
( b) the RC will be handed over after certification by the licensed surveyor along with the report with detailed photographs for nature and manner of repairs carried out.
Such survey reports will be somewhat like final survey and reinspection report without assessment part.


Since the buyers of the trade have more in depth knowledge of their competitors, they can and should inform the law enforcing agencies about any such activity being carried out by some bad elements. This is very important as wrong activities by bad elements brings the even genuine persons in scanner of the law enforcing agencies . One should also participate in salvage deals openly in a fair and transparent manner.


These are personal views on the matter and more suggestions are welcome.

Friday, August 12, 2011

What the RTI views about the disclosure of details of salvage buyers after accepting the tender by insurance companies

The Central Information Commission (CIC) has held that information pertaining to contractual proceeding — held by a public authority — cannot be withheld from disclosure once the contract is concluded. Information Commissioner A N Tiwari said that while confidentiality needs to be necessarily maintained about bids, before contract is finally awarded, there is absolutely no reason why after the award of the contract, confidentiality should be still maintained regarding the names of the bidders and quotation-details.
“In fact, all contracts entered into by public authorities, are bound to be open contracts. To draw an inference that this information should not be disclosed because it was in some way commercial confidence or personal information, which is barred from disclosure, will amount to erroneous interpretation of the provisions of law. A claim of confidentiality of such contract by a public authority is an indefensible claim. If allowed, it would mean that all contracts given out by public authorities shall not be open to scrutiny under the RTI Act. That position, if allowed to persist, would defeat the purpose of the Act,” he observed.

For More Details visit the link of news appearing in Indian Express below

Sunday, May 22, 2011


North India surveyors loss assessors adapting to disposal of insurance salvage through on line auction using free services made available by insurance surveyor free of any charges and bringing a most transparent and effective system for insurance surveyors. 

Insurers too in India can now need not outsource the service and can themselves use the service and thereby can monitor the disposal themselves in an open and transparent manner. 

The project had been started by insurance surveyor having experience in INDIAN insurance industry of more than 15 years and had been made operational in 2008. The collective efforts of surveyors loss assessors of North India made it possible to bring a transparent system . The concept behind the project is two fold one being to make transparent system and to make a database of all such vehicles which can lead to many benefits for the insurers in long run. The data is open for all and can be analysed by anyone. Even the details of seller surveyor and buyer can be obtained. 

What are its benefits? ……….. In Claim Minimisation & mitigation of losses. 

Present market scenario in insurance industry has made the insurance business most competitive and industry is looking for fair means in claim minimisation. Salvage disposal field can also be improved by using the available technology and in a way can contribute to long sought after claim minimisation process. The present system of auction by closed tenders / cash loss/ net of salvage basis give access of information to limited persons only and that too with high costs on account of advertisements , salvage garaging and its watch & ward overheads, wherein information is once only is made public and may or may not get noticed by all perspective buyers……… Whereas by using services at the information is available on the web free of charges live 24x7 and any potential buyer can having accessed the site once will know the definitive place where all such information of all such items is available. The information on site contains detailed photographs, details of item, sellers details, location of item and additional terms and conditions of seller. Since it is an open auction system on the web interested persons of distant places can also participate. More participation by the buyers will definitely result in most realistic and highest realisation of salvage value thereby contributing to claim minimisation. 
 Salvage value is always based on the market needs and its utility by individual buyer. Salvage may be just a scrap for some buyers, but for someone it may be his necessity. In short a wide coverage a single window must give best results for the sellers. 
 Salvage buyers are also benefitted as they get most of the information at one place at ease on 24x7 basis and thereby save time, energy and money in locating the salvage in markets. In present system they have less information in time, Such savings may get added in their offers for the salvage value. 

 Presently Surveyors and Individuals are listing the item on site under Private sector listings which is available as Free service for both the seller and the buyer. The web site provides free advertisement space and has no role in the deals as the same are to be settled among the buyer and seller only. Surveyors have to use their own skills to verify the genuineness of the buyers. The services available under the said sector listings have limited features as there are no users control panels. Furthermore under the same there are no earnest money charges and the same also have to be negotiated and dealt with by buyers and sellers among themselves only. Though the said sector has limited features, but still the users of site are finding the services useful under the said sector also. At Present surveyors are listing the item and after getting offers through web site are also further negotiating with the buyers and are seeking approval of the insurers using the printouts of their listings status. The services are proving useful for surveyors also as they can use the same in settlement of the claims. 

Saturday, April 9, 2011


What will you call a buyer of this vehicle ....... A Kabadi or Salvage dealer

How about buyer of this vehicle buying it using e auction online on net  from his Air conditioned Office 

POSITIVELY ...... Not Kabadi  who makes roundabouts in our lanes on bicycle

BUT ..... As Salvage buyer ...... And if has established businessman  as M/S ......XYZ  &  Sons .... having office and staff.

Insurance salvage used to be purchased by Kabadis and were being looked as uneducated and ill-literate persons in INDIA.

In present times unemployment has forced many young graduates to lookout in many new fields and one such field is sale and purchase of  salvage and scrap material. The field is highly paying provided the person has right approach. Many a persons feel hesitant to join this field and make it their profession as being termed as Kabadi in locality is never liked and is taken as downgrading of status in INDIA.

Now with modernization and with the IT use they have now the option to join the field with dignity and respect in the INDIAN society . They can instead of running in markets for the look out of salvage and scrap can now find the same from the comfort of their home or offices using the services available through the web. Many salvage and scrap disposal sites are working in INDIA also and one of the site is being even run by the Govt. of India conducting e auctions through MSTC. In insurance sector also some private players related to insurance had been giving competition in field of e auctions like isalvageauction , salvagemanagers , salvagesettlers , salvageindia , autoauction etc.

Young and energetic persons can now opt for this field and make handsome profits from the deals . They should however watch and explore all such e auction systems. They should first study the terms and conditions of each site and after satisfaction only proceed with the web based systems. They should also make contacts with insurance companies officials of their area and surveyors and loss assessors and open channels with them for salvage available and mode of settlement.

The main part lies with the valuation of the salvage and only experienced players can make profit out of deals and value of salvage depends on many factors like market value of item, repairs costs, availability of vehicle documents, scrap value of parts and so on.

Suggested way to enter in the field is to have some experience with and established player in the field and if you have added knowledge of net you will prove an asset to the established players who though are well established may not be familiar with e auctions etc. Once one gain experience in the field and has added advantage of knowledge of computers and e auctions then he can make handsome profits and above all will have good standing in society as salvage/scrap dealer and not as KABADI. 

Sunday, March 27, 2011

Customer should know … in event of major car loss

Insurance claim process should be known to the INDIAN customer in the event of claim to enable him to get his legitimate insurance claim out of an insurance claim and more so in the event the vehicle having suffered major loss, wherein Insurers and Surveyors will be negotiating for settlement of claim and informing you of insurance related terms as Depreciation, Total Loss, Constructive total loss , IDV, Net of salvage, Cash loss settlement and salvage value .

In India the car losses, for major losses if considered on total loss basis by insurers market value of the vehicle is not considered ,but the concept of IDV ( Insured Declared value) is taken and the customer in event of total loss can claim full insured value of his car as per IDV. The criteria of consideration of claim on total loss basis is subject to condition that if the vehicle has suffered loss more than 75% of the insurers liability on repairs basis based on IDV of vehicle. In case the vehicle is Total Loss then the insured is paid the full IDV and he has to get the vehicle salvage shifted to the insurers desired premises and has to transfer the ownership rites in favour of the insurers or has to get the registration of the vehicle cancelled from the registration authority ( RTO) as directed by the insurers.

Constructive Total Loss is another type of settlement, when the insurers settle your claim as Total loss. This mode is generally adopted when the IDV of the vehicle is less than its market value and liability of insurers on total loss basis is in interest of insurers. In such cases, if IDV less salvage value is lower than the repair liability such mode may be adopted.

Cash Loss Basis is another way of settlement of claim and in such cases the insured is paid repairs cost less some percentage as agreed by the insured and insurers mutually and is generally about 30% . In this mode of settlement the settlement is done prior to vehicle being repaired and the insured after settlement may get the same repaired in any manner and at any workshop and does not have to prove that that the vehicle is repaired and does not have to submit the bills of repairs. Such mode is opted mostly in case where insured claims as per authorised workshop estimates and after settlement on cash loss basis may get the repairs carried out at some local workshops with used parts and depends on the financial status of the insured.

Cash Loss Basis Net of Salvage.. in this type of settlement in event of major loss the settlement is on total loss basis and salvage is also retained by the insured. Thereby the insurers pay the customer the IDV value less salvage value of the vehicle and any other additional deductions as per the policy. Thereafter the insured is free to either repair or dispose off the vehicle and does not have to submit the bills of repairs or transfer the ownership rites to the insurers.

IN INDIA at present many cases are mostly being settled on cash loss net of salvage basis and mostly by the private insurers.


There are some more factors operative in settlement on cash loss net of salvage basis. With their own pros and cons.
On very few occasions that the insured may agree for settlement on cash loss net of salvage basis in its true spirit. Thereby he after settlement will retain the salvage himself and will get the vehicle repaired by him-self from some unauthorised workshop and thereby make the said mode of settlement beneficial for him as otherwise if he get the vehicle repaired from authorised workshop then the said mode will definitely be a loss making settlement for him.
However on most of the occasion the said mode of settlement is adopted in reports of insurance companies and is consented by the insureds , In practice in such cases the biggest hurdle is that the customer/ insured is not interested in retaining the salvage and either the insurers or the surveyors facilitate to arrange for the salvage buyers and thereby the said hurdle is overcome.

CAUTION ....  As per section 55 of MV Act, for all vehicles which are destroyed or rendered incapable of use the RCs need to be cancelled. 
The said duty is of the owner of the vehicle. If owner retains the vehicle and get it repaired on his own then there is no problem, but when he sells the vehicle salvage then he should take preventive measures against misuse of the salvage by buyer. The customer should demand from the insurers / surveyor regarding certification confirming the salvage value deducted by them and also importantly confirming that the value so deducted was considered for disposal with or without documents. The same will have bearing on the future sale of the vehicle. If they deduct the value without the documents then one should get the RC cancelled and dispose the wreck and should not get it repaired. If the value quoted is with the documents then customer may sell the salvage with documents if he so desires after taking some preventive measures as discussed in a related article in this blog.

Many a customer of private insurers do sometimes claim that they were paid the reduced IDV which is violation of the insurance policy in INDIA. They complain that collective value paid to them for the salvage and insurers is less than the IDV and they had given the consent for the same for settlement purpose. This complain is mostly reported against private insurers in INDIA but the same is not the true representation of all the cases.

CASH LOSS NET OF SALVAGE BASIS is also a very good way of settlement of claims and is mostly helpful to the customers as explained in major loss cases.

In event of major loss if the liability of insurers is less than 75%of IDV then the option available is for repairs basis, but there is mostly a vast difference in market value and the IDV as IDV is a scaled value system for all type of vehicles. In many cases it is not adviseable as said repairs will not be economical for the insured as even after the repairs the market value may not be worth to bear the burden of depreciations etc. Also in many cases after the accident the insured does not want to retain the vehicle for phycologial reasons in event of major loss. In such cases he may propose to insurers that his claim though not falling under Total loss be settled on cash loss net of salvage basis on reduced IDV value thereby making the settlement for insurers in their interest and changing their decision from repairs basis to to cash loss net of salvage basis.


IDV is Rs 3,00,000.00
Repairs liability Rs 1,50,000.00
Depriciation on Repairs basis to be born by insured Say Rs 40,000.00
Salvage value Rs 1,00,000.00 on Total loss basis.
In above case the insurers will insist on repairs basis and say if the market value of the vehicle after repairs will be Rs 2,50,000.00 then the customer should try to get his vehicle settled on reduced IDV basis as consented mode of settlement.
Here if the insured proposes to the insurers that he is ready to settle his claim on cash loss basis for Rs 2,50,000.00 or say Rs 2,40,000.00 and the salvage be arranged for disposal ( Provide facilitation for salvage disposal) this will make the liability of insurers on cash loss net of salvage basis as Rs 1,50,000.00 or say Rs 1,40,000.00 respectively for the above values. This will now be in interest of the insurers and they can not ignore the said proposal of the insured. Here the insured is also not at loss as he assumes that he had to bear depreciation part only.

Cash loss net of salvage basis on reduced IDV basis on consented basis is very effective way of settlement of losses, Any forced settlement by this system  on the customer should be avoided and customer should be educated about this mode of settlement also and if he proposes on his own will for the said mode then only this mode should be adopted.

More to come in forthcoming posts……


INDIAN Insurance companies luring the customers with loud words 



All motor policies are guided by the terms and conditions and every insurers policy wordings are similar , however a clever slogan and service provided by indirect means are really attracting large number of customers to the insurers giving such slogans.At present almost all the insurers are singing in the same tune. The customer should however know the inside story of such facilities being given to him and should be aware of his legal rights and thereby should be able to avoid any cheating by inter-mediator.


A big NO is the correct answer, but still the customer is getting benefit out of such proclaimed quotes by the garages and the insurers.


Customer approaches the preferred  garage of the insurers and gives details of his loss to the garage and submits the documents with the garage and all the formalities of lodging the claim with insurers, appointment of surveyor loss assessor or insurers in-house inspector , survey of vehicle and finalization of the claim is handled by the garage. Even the settlement is negotiated by the garage on behalf of the customer. Customer however has to pay the garage the deductibles like deprecation , excess clause applicable under policy and for the labor and spares not allowed by the insurers.

Customer feels happy that he had to pay very small amount for which he had to bear anyway and further the claim has been settled hassle free and saves his own time and energy.


Every part of the above is fine and in the interest of the customer, but unaware customers are many times being cheated by the workshop / workshop personnel even without the knowledge of the insurers and in some cases even by workshop owners.

Since the customer does not know the settlement arrived at between the insurers and the garage, and relies on the depreciation calculated and charged by the workshop which in many cases may be more than the what customer had been liable and what the insurers had settled.

Another key area is salvage value deduction by the garages. Almost all the garages deduct for salvage value of the parts replaced from the customer also and the salvage remain with the garage and thereby garages get benefited for the same. Such value is generally 5% of spares costs. In fact as per the general agreed conditions by the preferred garages is that they will retain the salvage and 5% of the salvage value will be deducted and the garage will recover the same by disposal of the said salvage and no where it is conditioned that the salvage value is to be recovered from the customer. The Garage may deduct the same only in cases where the owner takes possession of the salvage.

Towing & Recovery Charges  ...... Many a times customers use the services of recovery vehicles and for towing the damaged vehicles to the workshop and thereby as per policy are entitled for up-to maximum limit set for the said services. The customer has to submit the bills of said services obtained with the garages to be further submitted with the insurers, but at time of finalization of customers liability, the garages do not reduce the said entitled amount to the customer and only very vigilant customer point it out and get the said amount adjusted.

Customer should always demand for a proper receipt for the amount paid by him to the Garage falling under the insurance claim lodged and should also try to obtain the details of calculation carried out by the Garage. They can later check with the surveyor loss assessor or the insurers for the details of his claim settled and same should be in relation to the amount paid by him to Garage. In case they find they had been overcharged by the garage they cam lodge complaint with the insurers and garage and recover any excess amount charged by the garage.


Insurers are on their part are not giving and cashless service in reality. In actual the cashless facility is being given by the garages and it is their discretion to extend the facility to the customer. They provide the cashless facility to the customers in actual on voluntary basis. They follow the claim procedures laid down by the insurers and charge the part payment from the customer ( customers share on account of depreciation, excess clause etc) and the balance insurers liability is claimed from the insurers by following the proper procedure including survey and assessment and even negotiations. In case the liability is disowned  by insurers on account of discrepancy in claim documents or violation of policy terms and conditions at time of final settlement of the claim, the garage is at loss and the garage thereafter may or may not recover the said loss amount from the customer. Mostly the same will be bad debt only.


The preferred garage status gives many competitive business edges to the garages and few of them are marked as

  • The preferred garage status brings more jobs for them as every customer wants cashless service and like to get the repairs carried out at such preferred garages.
  • The preferred garage status allows workshops to negotiate and make deals with the insurers for settled labor and painting charges and thereby benefit. Also since the depreciation  etc are not applicable on labor charges, thereby the customer does not questions about the charges being charged nor seek any discount from the same. In general repairs( Non cashless cases) it is customary for the customer to seek some discount for the labor and painting charges and the garages have to oblige with some discounts to satisfy the customer for better business prospective.
  • With preferred status many a garages are utilized by the insurers for seeking insurance policies and thereby the garages give insurance business of new and renewal to the insurers and in turn earn commission on policies. This allows the garages to earn more and to provide all services to their customer under one roof and thereby the customer remains with them for all his needs.
  • Once a garage is established he is at better position to negotiate with the insurers and always keep the  sword hanging on the insurers at time of negotiations with threat that in case his demands are not met he will shift the insurance premium to another insurers who are always ready at his doorsteps. The insurers weakness is due to their laziness and the market trend that every one is looking to make arrangements for preferred garages.
  • One major contributor for the kitty of preferred garages is that they can lodge the claims on behalf of the customer. The vehicles coming to garage for routine jobs contribute for additional jobs also. How ? ........ A vehicle coming for say servicing is inspected by the workshop personnel and a minor accidental job is noticed and they inform the customer of the same. In normal circumstances the customer may not claim for the same, but the garage suggests for lodging claim and assures that the same will also be repaired in same time as for normal job and since the job will be hassle free the customer mostly will consent and thereby the garages create additional job for themselves. Some may say that it is just a perception and nothing more, still it has its some bearings.
  • The above are normal benefits for the preferred garages and there are many more hidden benefits thereby luring the garages for seeking preferred garage status. Garages with moral hazard are also there and is difficult to identify as they work very secretively and cover their tracks. 
With so much benefits the garages do take the risk of loosing some amount in some cases which are denied by the insurers, but mostly such cases are also finally settled by the insurers in interest of their own business and very few remain unsettled.

The views expressed are for information purposes only and customers having experienced any such case may share the same for information of others.