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Important Facts about Two-Wheeler Insurance You Wish You Knew

The enthusiasm for driving a bike is shown not only by purchasing it but also by insuring it. Pamper your bike with an adequate two wheeler insurance policy to ward off the financial loss that you might have to face in case of any unforeseen circumstances like an accident or theft.

Before buying a bike, there are lot of factors that you take into consideration - like its brand, cost, design, model, mileage, cubic capacity, and other configurations. However, a bike insurance policy might be the last thought on the mind.

We think either about it or not at all. Many of us forget to even consider it. Just because it is mandatory to have a bike insurance policy for every bike-owner, you might end up buying any policy, without even knowing the basic facts that you should be taking into consideration.

Therefore, to safeguard your bike, it is imperative to have it insured. While buying the bike, flipping through some two-wheeler insurance policies is not a bad idea.

Supreme Court Ruling on Third Party Two-wheeler insurance

As per the recent ruling was given by the Supreme Court, IRDA has asked every general insurance company to provide long-term third party insurance policy to all the vehicles that are being sold after 1st September 2018.

As a result, the insurance companies that were earlier providing an annual third party bike insurance; will now be offering 5-year insurance for all the new two-wheelers.

The idea is to reduce the number of uninsured vehicles on roads and also to ensure long-term coverage for all the two-wheelers. Moreover, it will save the customer from the hassle of renewing their insurance policy every year.

This implies that an upfront premium amount has to pay for 5 years and it is only applicable on third-party liabilities and not on the own-damage section.  And for cars, this limit is 3 years.

However, the new rules will not have any impact on the IDV or Insured's declared value of your two-wheeler.  As the IDV is based on the listed selling price that is fixed by the manufacturer for the particular model and brand.  Even the no-claim-bonus will be compute after completion of the policy duration.

Seven Important Factors Consider Before Buying Insurance

Types of Coverage:

Ensure that your policy covers any physical damage caused to your or third party vehicle, accident cover or injury to you or third party, death and other unforeseen damages which may incur.

The insurance policy provides coverage against accidental damage, theft, natural disasters, explosion, riots, etc. There are policies that cover the pillion rider as well. You can select the one as per your requirements.

Premium Cover:

  • Your two-wheeler’s premium amount varies on a number of factors, including your bike’s cubic capacity (cc), for example, if your bike is 150cc, its premium will be quite less as compared to a 350cc bike.
  • For instance, if you have a two-wheeler insurance plan, then the cost of the premium for two different bikes for the same plan can vary.
  • The premium also varies based on the city of purchase, for example, all the metro cities would have a higher premium as compared to tier 2 cities.

Third party Insurance:

It is the most basic and compulsory form of a bike insurance policy. It covers you from any legal liability or any form of compensation that you may need to pay (the insured); for any loss or damage, which is caused by your (the insured) vehicle to another person, property or vehicle.

A third party is any person or property, apart from the insurer and the insured. A third-party can be anyone - a pedestrian, a public transport bus or passengers, pillion rider, driver of another vehicle, or any animal for that matter.

Comprehensive Two-Wheeler Insurance Cover:

  • If you want to enhance the coverage of your bike insurance policy, then a comprehensive policy is recommended.
  • It will provide coverage to you and your bike against any loss or damage arising due to natural disasters, fire, explosion, accident, and vandalism.
  • It provides third party liability cover against any accidental death or injury caused to a third-person by your 2-wheeler. It also covers any loss or damage caused to your own two-wheeler or property during the accident.
  • There are additional benefits that you can avail with roadside assistance - including agency repair, roadside assistance, etc.
  • Before finalizing a comprehensive bike insurance policy, it is recommended that you go through all the terms and conditions in the policy wordings.

Ownership:

If you buy a second-hand bike or sell your bike to someone else, in that case, you would need to transfer your insurance to the new bike owner, and needs to be informed to the insurer with all the necessary insurance details.

And in case, you buy a brand new bike of the same value, then also, the same policy can be substituted for the new vehicle and the premium would be paid accordingly.

Compare and then Buy Policy Online:

  • It is important to compare different two-wheeler insurance plans online. Initially, you can compare the difference in coverage provided in a comprehensive or third-party bike insurance plan.
  • The former will cover both own damages and third-party damages and the latter will cover damages caused by your two-wheeler.
  • While making the purchase, you should check all the policy features, the cost of the premium, coverage type, inclusions, and exclusions and then make the decision.

Do not Ignore the Exclusions:

Before you make the purchase, you should be aware of the circumstances under which your claim will be invalidated-

  • Any consequential loss or damage
  • Routine wear and tear of your insured two-wheeler
  • Breakdown due to electrical or mechanical failures
  • Driving after the consumption of drugs or alcohol
  • Damage to the tires of your 2-wheeler unless the damage is caused to the body as well. In that case, some of the insurance companies may offer compensation of 50% of the replacement cost.
  • Damage resulting due to nuclear weapons or radiations

Also, check for ‘No Claim Bonus’ in case you do not claim your policy, and as the number of years increases, so does the benefits, with an upper limit attached to it.

In a Nutshell!

A 2-wheeler insurance policy offers sufficient coverage against unforeseen perils that may arise while driving on the roads. A third-party bike insurance policy is mandatory; but, it is advisable that you buy a comprehensive plan to enjoy driving with a peaceful mind.