Insurance company says it won't reimburse GST part of claim: Now what?

In discussions with my current garage, they show willingness to provide an invoice, facilitating GST recovery.

BHPian bravo82in recently shared this with other enthusiasts.

I am the owner of a 2022 Honda Amaze, currently in its second year of ownership. This year, I opted for Digit Insurance through a trusted agent.

Regrettably, on November 29, 2023, my vehicle encountered the recklessness of a truck, resulting in damage to the right rear quarter panel, bumper, and tail light. Eschewing my previous unpleasant experience with a Honda body shop, I opted for a reliable Friendly Neighbourhood Garage (FNG) this time.

On November 30, 2023, I kickstarted the claim process with Digit Insurance via their online platform, furnishing a meticulous array of documentation, including detailed pictures, a 360-degree video capturing the extent of the damages and details of the workshop.

Today, December 1, 2023, the designated surveyor has brought unwelcome news. Due to the garage's lack of affiliation with Digit Insurance, cashless repairs are off the table. A bitter pill, but acceptable. However, the surveyor's subsequent revelation is harder to swallow – the GST (Goods and Services Tax) component of the invoice won't be reimbursed. He suggested relocating the car to their authorized garage, but why? I am fine with non-cashless repairs. Do I not have the right to choose where I want my car repaired? How does shifting to a different garage resolve the GST issue? Is this a form of arm-twisting under the guise of GST?

In discussions with my current garage, they show willingness to provide an invoice in Digit Insurance's name, facilitating GST recovery. It's disconcerting that, despite holding a zero-depreciation insurance policy, a formidable 12-18 percent GST deduction looms. This raises serious questions about fairness and prompts me to question the intent of the insurer.

Here's what BHPian ike had to say on the matter:

 Are you GST registered(unlikely but still asking)? This particular transaction is between you & Digit. The garage is getting settled by you and subsequently you are reimbursed by Digit. GST invoice from garage will be issued to you under your name. If you aren't GST registered, Digit won't be able to claim input on the same. Digit dealing directly with a garage that has a GST registration will be less complicated. I'd wait for the others to weigh in, I'm not an expert here.

BHPian bravo82in replied:

Probably I put it the wrong way. The insurer will reimburse the bill of repairs minus the standard deductions and GST.

The garage is GST registered and willing to invoice the digit insurance directly

I am not GST registered. Till date all my insurance claims were reimbursed with GST.

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