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What is Key Replacement Cover in Car Insurance

Team AckoJan 17, 2024

Losing or misplacing your car keys is both frustrating and stressful, and can also be quite expensive to repair or replace. Not so long ago, losing your car keys was not a big issue. You might even have a spare car key to get you out of trouble. But as cars have technologically advanced, especially modern electronic key Frequency Operated Buttons (FOBs), they are a lot more expensive to replace compared to the traditional car key. 


Opt for the key replacement cover in car insurance. It is an Add-on to the Comprehensive insurance policy of your car. In this article, find out what is key replacement Add-on, its claim procedure and what it includes.



Key and Lock Replacement in Car Insurance:

Modern cars, especially luxury cars, are equipped with a keyless Frequency Operated Button (FOB) or remote key lock system. With the FOB, you don’t need a car key to open the lock or start the car’s engine, it is electronically controlled, and with a push of a button, you can either start or stop the engine of the car.

With advanced technology such as FOB, high-end car keys are expensive to replace. While most insurance companies provide cover for lost keys, they do not offer protection against car lock. However, you can talk to your insurer to understand if they provide both key and lock replacement cover and choose the right plan for your car and its key.

What is Key Replacement Cover in Car Insurance?

Car keys have evolved over the years. They are not just a metal piece with grooves to unlock or start the car engine. Sophisticated and technologically advanced car keys are the new norm, especially the electronic keys. They are known as Frequency Operated Buttons (FOBs). If they are lost or misplaced, replacing them is quite expensive. Insurance companies are evolving along with modern times and are covering such car keys through the option of add-on covers. The coverage for your car keys is known as Key Replacement Cover in car insurance.

Key Replacement Cover is an Add-on to your car’s Comprehensive insurance policy and not a standalone cover. With an additional premium, the Key Replacement Add-on will cover the cost arising out of the replacement of the insured vehicle’s key. This can be if the key is lost, damaged or stolen, or the cost to repair the lock-set if the lock or the key are damaged.

The benefits of this Add-on are subject to the terms and conditions listed below:

  • A First Information Report (FIR) with the police needs to be filed to support the claim.

  • The replaced key/lock/lockset should be of the same kind and nature.

  • The insurance company should be intimated immediately no more than 30 days.

  • The key replacement will be for damaged or broken keys. In case it’s stolen, the entire set of key, lock and lockset will be replaced.

The exclusions are listed below:

  • Any damage or loss to keys/lock/lockset arising out of malicious activities or any deliberate or criminal act.

  • Any damage or loss covered under the manufacturer’s warranty.

  • Any claim where there are no valid receipts or invoices for the payments made.

  • Any damage or loss due to radiation or hazardous properties.

  • Any damage or loss to any part of the insured vehicle apart from the keys/lock/lockset and its associated parts such as ignition system, an immobilizer, alarm or infra-red handset attached to the FOB.

Also, read: Own Damage Insurance

How to Buy Key Protect Claim Add-on?

Car key protector cover is available as an Add-on to the Comprehensive car insurance policy. You need to opt for it while you buy or renew the standard comprehensive insurance. Buying a Key Protect Add-on is a lot easier through the online method. Below are the steps to buying Key Protect Add-on cover online:

  • Step 1: 

    Visit the insurance company’s website or its mobile app.

  • Step 2:

    Buy the standard comprehensive car insurance policy and include the Add-on cover before you pay and purchase the policy. You can also buy the Key Protect Cover when you renew your car insurance policy.

  • Step 3:

    Receive the policy document instantly to your email address.

Benefits of Key Protection Add-on Cover:

Below are the benefits of the Key Protection Add-on Cover:

  • Replacement of the car key/lock/lockset of the same kind and type in case it is lost, stolen or damaged.

  • Key replacement in case of theft or burglary and the lockset will be replaced in case of theft or damage.

  • Easy online experience.

  • Will not affect the policyholder’s eligibility for an NCB (No Claim Bonus) at the time of renewal.

Also, read: Zero Depreciation Car Insurance

Why is Car Key Insurance Important?

The Indian car market has evolved over the years. New and sophisticated technology is increasingly being used by car manufacturers to offer safer and feature-rich vehicles. One of the advancement is the key, lock and the lockset. While luxury cars featured some of these technologies, affordable and economical car manufacturers have started to offer them in some of the best or mass selling vehicles.

One among them is the keyless Frequency Operated Button (FOB) or remote key lock system. The technology controls several functions such as the car’s lock and unlocks functionality without the need for a physical key. Through a push of a button, you can either start/stop your car’s engine. Advanced technologies such as this are expensive to replace or repair.

Also, read: Vehicle Scrappage Policy in India

Types of Car Keys:

There may be situations when you may need to replace your car keys. The key may be damaged or broken, or stolen. Knowing what type of car keys you have is beneficial when it is being repaired or replaced. 

  • Basic/Traditional Car Key:

    The basic machine cut with almost no security features and can be easily duplicated by a locksmith.

  • Remote Car Key:

    This type of key boasts of some security features with a transponder which emits radio waves or infrared to lock or unlock the car. Replacement of remote keys is expensive due to the work involved in reprogramming the security features.

  • Smart Car Keys or Keyless Frequency Operated Button (FOB):

    Through sensors, the car can sense the key nearby and it automatically unlocks the door without the need for you to physically unlock the door.

Why Replacement of Keyless FOB/Remote Key is Expensive:

The FOB includes security features of the key to your car. If it is damaged, stolen or lost then you should replace it. The remote key has a unique computer-generated code which is programmed to match with the code present in the locking system of your car. Apart from the basic lock/unlock feature, depending upon brands and models the features can vary and the cost can increase based on the number of features it presents. 

Hence, the more the features, the more it costs to replace or repair the keyless FOB or remote keys. A Key Replacement Add-on will cover against these high expenses since they concern the security aspect of your car.

What Does Car Key Cover Include:

Car Key Cover or the Key Replacement Cover is an Add-on to the Comprehensive insurance policy. The insurance company will reimburse the insured, up to the insured amount specified in the insurance policy for the purpose of replacing the insured car’s key if the key is:

  • Lost

  • Stolen

  • Damaged

  • Repairing of the lockset if the lockset or the key is damaged.

  • Key replacement only in case the key is damaged or broken.

  • In the case of burglary, the key, lock and lockset will be replaced.

Also, read: Guide to Insurance Claims for Flood Damaged Cars

Cost of Car Key Replacement Insurance:

The premium towards Key Protect Add-on is lower compared to the original cost to replace the damaged lockset. The remote key or the keyless FOB is expensive to replace. Paying a small amount for the Key Replacement premium can cover the high replacement cost of the lockset. However, this amount is subject to the maximum sum insured you have opted for.

Private Car Package Policy – Add-ons: Key Protect

By paying a slightly higher premium for the additional coverage for the car keys, the car insurance policy comes with special conditions and exclusions. Below are the details:

Special Conditions:

  • NCB will not be affected at the time of renewal if you raise the claim towards the replacement or to repair your car keys.

  • In case the car key is stolen or burglarized, it should be supported by an FIR.

  • The replaced car keys, lock or lockset should be of the same model or kind for which you are raising a claim.

  • You need to report the loss of the car keys within 30 days of such a loss or damage.

  • In case the key is broken or damaged, only the key will be replaced.

  • In case of theft of the keys, the insurance company will replace the entire set which includes the key, lock, and lockset.


  • The claim will be rejected if the damage or loss of the car keys, lock or lockset is because of malicious activities, criminal or deliberate acts.

  • Any damage or loss covered under the car manufacturer’s warranty.

  • In case invoices or receipts of payments towards the replacement/repair of the car keys are not produced, then the claim will be rejected.

  • In case the damage or loss is due to radiation, radioactive contamination or the hazardous properties of any explosive, invasive, corrosive or toxic substances or material, the claim will be rejected.

  • In case of any loss or damages to your car other than the keys of the insured vehicle, its associated lock, infra-red handset, ignition system, any immobiliser and/or alarm of the key FOB, then the claim will be rejected.

Also, read: What is Total Loss

Commercial Vehicle Package Policy – Add-ons: Key Protect

Key Protect add-on cover can be bought for commercial vehicles, passenger carrying vehicles, taxis, etc. Similar to the private car package, the commercial vehicle key protection add-on also comes with special conditions and exclusions. Below are the details:

Special Conditions:

  • NCB

  • In case the claim is due to theft or burglary, it should be supported by an FIR.

  • Since this add-on reimburses the cost to replace or repair the car keys/lock/lockset, the replacement should be of the same nature and kind.

  • You need to inform the insurance company within the stipulated time mentioned on the terms and conditions. Usually, it is 30 days from the day of any loss or damage to the insured vehicle’s keys/lock/lockset.

  • In case the car key is broken or damaged, a replacement of the key (s) will be provided. However, in case it was stolen, the entire set will be replaced.


  • If the car key(s) is damaged or lost due to malicious activities, criminal or deliberate acts by the insured, the claim will be rejected.

  •  Any damages or loss covered under the car manufacturer’s warranty period or any service contract, the claim will be rejected.

  • If the policyholder is unable to produce receipts or invoices for any payments, then the claim will be rejected.

  • Also, your claim can be rejected if the damage or loss is due to radiation, hazardous properties of any corrosive, invasive, toxic substance or material, or due to explosives.

  • In case of damage or loss to other parts than to the keys or associated parts such as lock, ignition system, infra-red handset, any immobiliser and/or alarm attached to the FOB.

Claim Process for Key Replacement Cover:

The claim settlement process is similar to replacing the lockset from an authorized OEM or from a regular car workshop. Below is the claim process for key replacement:

  • Step 1:

    Get your car lockset repaired or replaced.

  • Step 2:

    Submit the invoice or bill of the replaced remote-lock system to the insurance company for the reimbursement process.

  • Step 3:

    Depending upon the cost of replacement, subject to the maximum sum insured, your claim will be settled.

How To Claim Car Insurance for Key Protection?

In case you lose, misplace or damage your car keys, the add-on cover will reimburse the cost to replace or repair the key(s) lock/lockset. They are protected under the lost car key insurance, which is known as Key Protect Add-on. Follow the below steps to raise a claim for replacing/repairing your car keys:

  • Step 1: 

    Call your insurance company (Example: Acko General Insurance) and inform them about the loss of your car keys and mention how it was lost.

  • Step 2:

    In case the keys were stolen, you should file a First Information Report (FIR) at the local police station.

  • Step 3:

    Get your car keys either repaired or replaced and then raise a claim with the insurance company.

  • Step 4:

    Submit the required documents with your insurance provider. If the claim is within the terms and conditions, the insurer will reimburse up to the amount specified in your policy for replacing or repairing car keys.

Certain insurers may offer the cashless settlement for the key replacement if you get it replaced at the nearest network garage of the insurance company.

Also, read: How to Transfer Bike and Car Insurance to New Owner

Things To Keep in Mind While Filing a Claim:

While raising a claim for the repair or replacement of the car key(s), ensure you follow the below guidelines:

  • Ensure you get a First Information Report (FIR) at the local police station in case the key was stolen.

  • Make sure you report the loss/damage of the car key(s) to the insurer as per the stipulated time frame.

  • While repairing or replacing the key, ensure they are of the same nature and kind since the insurance company will reimburse the claim after scrutinising the make and model of the key(s) which should be of the same specifications as the insured vehicle’s key(s).

  • The insurance company will approve the claim only for replacement of the key in case it is damaged or broken.

  • The entire set including that of the lock/lock/lockset will be replaced only in case it was due to theft or burglary.

  • Ensure you retain the invoices or receipts of the payment for the insurance company to approve your claim.

  • The insurer will not approve your claim in case it is found that damage or loss is due to malicious activity or deliberate act.

Also, read: Insurance for Bike

FAQs About Car Key Replacement Cover and Key Protect Add-on:

Here are some of the frequently asked questions about key replacement cover in car insurance:

Which type of car insurance will replace car keys?


Key Replacement Cover or the Key Protect is an Add-on. Hence, you can choose this cover only with the Comprehensive car insurance policy. Only opting for the Third-party Liability will not allow you to include an Add-on to the policy.

What should I do if I lose my car keys?


In case of burglary or theft or if you have lost your remote-key or keyless FOB, you need to file an FIR with the police. After filing the FIR, you can get the key and lockset replaced and then raise a claim for reimbursement of the expenses by submitting relevant documents.

What should I do if someone steals my car keys?


As mentioned, file an FIR with the police and proceed with the replacement of the keys and then raise a claim through the reimbursement process.

What should I do if my car locking system is damaged?


Get the lockset replaced or repaired and then raise a reimbursement claim by submitting the invoice or bill of the key replacement of the insured vehicle.

Can I use duplicate keys as an option?


A car key can be duplicated by a local locksmith. However, these keys are not secure since the electronic code is known by the local locksmith. While it may cost you less by getting a duplicate key from a local locksmith, the risks are too high. Therefore, get your car key replaced by an authorized OEM workshop.

Why is car key insurance important?


High-end or luxury cars are expensive and to ensure the safety of the car, even the car key(s) have become technologically advanced. Car manufacturers have developed new types of car keys which are either a remote-controlled or keyless Frequency Operated Button (FOB). Hence, a replacement or even to repair them, it is expensive and requires a specialised mechanic to fix it. To avoid any financial liabilities arising out of the loss/damage of these types of keys, the car key insurance is practical and helps you while replacing or repairing it.

Why is the replacement of car key(s) such as FOB costly?


Several safety aspects and convenience features of the car are controlled by high-end car key(s) such as a FOB. Also, the technology can vary between different car models or brands. Hence, these types of car keys are expensive to replace or even to repair. More features, more the price of these high-end car keys. Hence, replacing it is indeed a costly affair.

What are the advantages of Key Protect Add-on cover?


While you pay a slightly higher premium to include the add-on cover, the premium amount is comparatively lower than the actual cost of replacing the car key(s). Please note, the reimbursement towards this claim will be the maximum sum insured amount set for the replacement or repair of the key(s) lock/lockset. Also, under the comprehensive car insurance policy, insurers do not cover the repair or replacement cost of the car key(s)/lock/lockset. In case of an accident and the key lockset is damaged, you will have to pay from your pocket; however, with the Key Protect add-on, you can recover the cost.

What happens if only the car lock is damaged but the key is not damaged?


The insurance company, based on the terms and conditions of the policy, will reimburse the cost to repair the lock/lockset. Only if the key is damages/loss/stolen, then it will be replaced.

What if I continue to use the spare key in case the other is lost/stolen?


In case your car is stolen, the insurance company will request you to produce the spare car key(s). If you do not produce the keys, then you may be in big trouble and the possibility of your claim being rejected is high.

Disclaimer: The content on this page is generic and shared only for informational and explanatory purposes. It is based on industry experience and several secondary sources on the internet; and is subject to changes. Please go through the applicable policy wordings for updated ACKO-centric content and before making any insurance-related decisions.

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