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Key Replacement Cover in Car Insurance

By Vikas Chandra Das
21 July 2022, 11:46 AM

Technology has made the lock and key system of the car more advanced and expensive over time, which makes it important to buy a Key Replacement cover for the same. Read on to understand more about this beneficial add-on.

What is a Frequency Operated Button (FOB)?

These are remote key lock systems that are electronically controlled with a push of a button. Most modern cars are equipped with this locking system and these are rather expensive due to the advanced technology involved in manufacturing them.

What are the Other Types of Car Keys?

There are three main types of car keys and they are as follows –

Basic or Simple or Traditional Car KeyRemote Car KeySmart Car Keys or Keyless Frequency Operated Button (FOB)
This does not have any security feature and can be easily duplicated by a locksmith.These keys have security features with some transponders to lock and unlock the car. Replacement of remote keys is expensive as it will have to be reprogrammed.There is no requirement of physically locking or unlocking the door, as the sensors will do the job.

What is a Key Replacement Add-on in Car Insurance?

The key replacement add-on is an additional cover that one has to purchase under a comprehensive insurance policy with an additional premium. This cover is purchased to provide for the costs arising out of the replacement of the insured vehicle’s lost, damaged, or stolen key.

What are the Conditions that Need to be Fulfilled to Activate this Cover?

The following conditions have to be fulfilled before policy cover is activated – 

  • The FIR needs to be filed with the police to support the claim.
  • The key or lockset that one must replace the old set with should be of the same kind and specifications.
  • The car insurance company should be intimated at the earliest, with a maximum leeway period of no more than 30 days.
  • The key replacement will be for damaged or broken or stolen keys.

What are the Benefits of Buying a Key Replacement Add-on?

The benefits of this add-on are as follows – 

  • It will ensure easy replacement of the car ke
  • y or lockset in case it is lost, stolen, or damaged.
  • It will not ensure the policyholder’s eligibility for an NCB at the time of renewal of the car insurance.

What is Covered Under the Key Replacement Add-on?

The following inclusions are guaranteed in a key replacement add-on – 

  • When the car keys are lost;
  • When the car keys are stolen;
  • When the car keys are damaged.

Usually, when the lockset is damaged – the car insurance key will be repaired if it is damaged, a key replacement will be done in case it is broken or lost, or stolen. 

What are the Exclusions in a Key Replacement Add-on?

Beyond the standard exclusions that are common to most insurance policies, the following exclusions are provided for – 

  • Damage or loss to the keys that are already covered under the manufacturer’s warranty.
  • Damage or loss to keys or lockset arising out of malicious activities or any deliberate or criminal act.
  • Damage or loss to the keys due to radiation or hazardous properties.
  • Damage or loss to any part of the insured vehicle apart from the keys or lockset and its associated parts such as the ignition system, an immobilizer, alarm, or infra-red handset attached to the FOB.
  • Circumstances, where the claim is made, are such that there are no valid receipts or invoices for the payments made.

How to Buy a Key Replacement Add-on?

The process of buying a key replacement add-on is simple. The steps are as follows – 

  • The policyholder has to go to the insurance company’s website or its mobile app.
  • Thereafter, one must buy the standard comprehensive car insurance policy which includes add-on cover before you pay and purchase the policy.
  • One also has the option of buying the Key Protect Cover while renewing one’s car insurance policy.
  • One will receive the e-copy of the policy document instantly to one’s email address and a physical copy of the same via post.

What is the Cost of the Key Replacement Add-on?

The remote key or the keyless FOB is expensive to replace and the premium that the policyholder must pay towards Key Protect Add-on is lower than the original cost for replacing a damaged lockset. 

How to Claim Car Insurance for Key Protection?

The process of claiming one’s car insurance cover is as follows – 

  • One must get the car lockset repaired or replaced. Simultaneously, in case the car keys were stolen, one must file a First Information Report (FIR) at the local police station first.
  • The invoice and bills that one gets out of the replaced remote-lock system will be given to the insurance company and this step will initiate the insurance reimbursement claims process.
  • Depending upon the cost of replacement and subject to the maximum sum insured, one’s car insurance claim will be settled by the car insurance company.

Things to Keep in Mind While Making the Claim

  • Ensure that an FIR is filed at the earliest with the local police station.
  • Report the damage or loss of keys within the stipulated time period.
  • Replace the keys with those of the same nature and specifications.
  • Ensure the invoices are duly submitted to the insurance company to support your claim.


High-end or luxury cars are expensive to maintain and it is important to have a key replacement cover to avoid financial liabilities arising out of loss or damage of these kinds of car keys. Purchase these after perusing all terms and conditions associated with this cover.

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