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How to Know If Insurance Is a Comprehensive or Third-party Bike Insurance Plan?

Are you planning to buy a bike insurance plan for your bike? There are many factors that you must consider when you are planning to buy bike insurance and the most important thing you need to consider is the kind of coverage you would get after purchasing it. In India, the insurance companies offer two types of bike insurance policies - third-party policy and comprehensive policy. But people often tend to get confused between these two. So let us make it easier for you to understand the difference.

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Things to Know About Third-party Insurance Policy For Bike 

In India, for all bike owners, as per the Motor Vehicle Act 1988, it is compulsory to have at least a third-party bike insurance policy. It covers any third-party liability you might face during a bike accident.

In case of an accident or crash, the third-party bike insurance policy comes into the picture. Under this, the damages caused to the third-party properties are covered by your insurer. Also, if any third party is physically hurt, wounded, or majorly injured along with property damage or their vehicle gets damaged after due to your bike, these liabilities will be covered under it.

Therefore, if you have third-party insurance, you will be free from any financial strain that can cause any damage to a third party in case of an accident.

Benefits of Buying Third-party Insurance Policy For Bike

It only covers third-party liabilities, that is why it is the most affordable type of insurance cover. If you wish to get coverage for any third-party liability only and since it is mandatory, you have to purchase a third-party bike insurance policy after comparing different two wheeler insurance provided by different companies.

As per Motor Vehicle Act 1988, it gives you the authority to drive your bike legally. Also, it is mandated by law, and not having this plan can land you in legal troubles along with hefty traffic challans.

What is Excluded From Third-party Insurance Policy For Bike?

One of the major drawbacks of third-party bike insurance is it does not cover own damages (OD). Other than this, any damages caused while driving under the influence of intoxicating substances like alcohol or drugs will not be covered under third-party bike insurance.

It will also not entertain those bike drivers who violate the traffic rules and do not carry their valid driving license.

Things to Know About Comprehensive Bike Insurance Policy

A comprehensive bike insurance plan is overall protection offered by the insurer to their policyholders. As a bike owner, you must have this protection cover, even though it is not mandatory.

It covers all the damages that you might suffer in an accident. You get assurance for your bike against the damages caused due to theft, fire explosion, natural or made-disasters, and total loss. Even it gives you protection for third-party liabilities that you might face in the event of an accident.

Benefits of Buying Comprehensive Bike Insurance Policy

One of the major benefits of having a comprehensive insurance policy is that it covers Own Damages (OD) along with third-party liability cover. This gives you complete protection in any unfortunate event like a collision, fire, or road accident.

Although the premium for this plan is higher, considering the benefits and the policy coverage, it is a cost-effective deal. Therefore, it offers you great savings in the long run. You also get compensation for the loss in case of theft.

What is Excluded From Comprehensive Insurance Policy?

Under your comprehensive insurance plan, certain instances are not covered like- any consequential damage after the accident, unless you don't have any add-on cover for it. Also, damages caused to the bike due to electrical or mechanical breakdown are excluded from it. However, there are add-ons available that you can purchase by spending an extra amount.

If you are involved in an accident where you don't have a valid driving license or you were driving under the influence of alcohol or drugs you won’t be able to avail any claim.

Third-party Bike Insurance Versus Comprehensive Bike Insurance

If you have confusion between both the plans, we have discussed a detailed chart showing how third-party bike insurance is different from a comprehensive plan-

Points of Basis Third-party Bike Insurance Comprehensive Bike Insurance
Meaning It is a basic form of coverage given to the bike owners that protect them from any financial liabilities caused to the third-party vehicle or life from their insured vehicle. It also covers you from death/bodily injuries to the third party in an accident. It is a type of all-round protection for your bike that includes third-party liabilities along with that  damages caused to your own bike during an accident.
Mandatory Third-party insurance is mandated for all bike owners in India. It is not compulsory to have comprehensive bike insurance.  
Advantages It gives you financial protection if you ever get involved in an accident and damage third-party vehicles or bodily damage to them. You don’t have to pay for the damages caused to a third party from your bike out of your pocket. It gives you financial protection for all kinds of third-party liabilities as well as Own-damages (OD). Additionally, it safeguards your vehicle from various instances including natural or man-made disasters, theft, total loss, fire, etc.  
Limitations It does not give protection for the damages to your own bike. The only limitation for this plan over third-party bike insurance is it is more expensive.
Customization Neither you can customize your third-party bike insurance cover, nor you can buy any add-on covers with it. You can customize your plan according to your needs and budget. Also, you can buy any of the required add-on covers with it.
Premium Amount The premium you pay for third-party bike insurance is less than the comprehensive cover because it covers the limited liability. The premium amount for comprehensive cover is higher, as it depends upon the various factors like coverage, the add-ons you opt for, etc.
Claim Settlement Process Under third-party bike insurance, the claim settlement is conducted under Motor Accidents Tribunal. The claim settlement process is conducted by the insurance company and depends on the type of claim.
No Claim Bonus You cannot avail the benefit of No Claim Bonus. You get a discount bonus for not raising any claim in the previous year which is known as NCB.
Who Should Buy? If you are owning an old bike and seeking an affordable option, then third-party insurance is enough for you. If you want overall protection and have an expensive or brand new bike, then you must buy this insurance plan. Along with it, you can buy add-on covers.

Final Thoughts

By reading the above comparative chart, now you can easily differentiate between third-party bike insurance and comprehensive bike insurance. Moreover, we suggest you choose a comprehensive insurance plan over a third-party plan because of higher coverage, more benefits, and better financial security.

 

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Disclaimer: Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.

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^The renewal of insurance policy is subject to our operations not being impacted by a system failure or force majeure event or for reasons beyond our control. Actual time for a transaction may vary subject to additional data requirements and operational processes.

^The buying of Insurance policy is subject to our operations not being impacted by a system failure or force majeure event or for reasons beyond our control. Actual time for transaction may vary subject to additional data requirements and operational processes.

#Savings are based on the comparison between highest and the lowest premium for own damage cover (excluding add-on covers) provided by different insurance companies for the same vehicle with the same IDV and same NCB.

*TP price for less than 75 CC two-wheelers. All savings are provided by insurers as per IRDAI-approved insurance plan. Standard T&C apply.

*Rs 538/- per annum is the price for third party motor insurance for two wheelers of not more than 75cc (non-commercial and non-electric)

#Savings are based on the comparison between the highest and the lowest premium for own damage cover (excluding add-on covers) provided by different insurance companies for the same vehicle with the same IDV and same NCB.

*₹ 1.5 is the Comprehensive premium for a 2015 TVS XL Super 70cc, MH02(Mumbai) RTO with an IDV of ₹5,895 and NCB at 50%.

*Rs 457/- per annum (1.3/day) is the price for the third-party motor insurance for private electric two-wheelers of not more than 3KW (non-commercial). Premium is payable on an annual basis