Uzair Jan
If you have purchased your new first bike, we would like to congratulate you on it. After all the research of different bike manufacturing companies, narrowing it down to the perfect dealer, completing the purchase formalities, we are sure you can’t wait to cruise the roads on your new bike.
But wait, do you know that two-wheeler insurance is mandatory as per Indian law to ride the bike? Did you get your bike insured? If you haven’t and are seeking more information on what two-wheeler insurance is, and how it works, then you are at the right place. We have put together a comprehensive guide to familiarize you with the nuances of two-wheeler insurance.
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Why is two-wheeler insurance important?
Every single day thousands of people buy new bikes in India, this also means with every passing day the number of bikes on the road is also increasing manifolds. The increased traffic on the road, bad road conditions, irresponsible driving skills has also heightened the chances of bike accidents.
As a step of protection, the Motor Vehicle Act, 1988 under Indian law has mandated every bike owner to have active bike insurance at all times. If you do not get your bike insured, this means you are not abiding by the law and you will be levied with heavy penalties and you can even face imprisonment. Two-wheeler insurance is important because it extends financial help to you and your prized possession against damages from unpredicted events.
Types of two-wheeler insurances
Broadly two-wheeler insurance can be classified into 3 types:
– Third-Party Liability Insurance: This is the basic policy that any bike owner should have as per the law. This insurance policy covers damages to the third party’s bike, property, bodily injuries, or even in case of the death of the third party due to an accident involving your bike. Remember that this type of insurance doesn’t cover any damages that happen to your bike but only covers damages caused to the third person.
– Own Damage Bike Insurance: This type of bike insurance covers your bike against damages caused due to accidents, natural calamities, theft, or even vandalism. A couple of things to remember here is that this is optional, and it doesn’t cover third-party liability.
– Comprehensive Bike Insurance: As the name suggests, comprehensive two-wheeler insurance is a combination of the above to insurances. It is the most opted insurance as the coverage provided under this policy is extensive and helpful.
How is the premium for two-wheeler insurance calculated?
Now that you know the different types of two-wheeler insurance, we are sure you must be wondering how exactly the premiums of these insurance policies are decided? Several factors are taken into account like the brand of your bike, the cubical capacity (CC) of the bike, make, model, and year of purchase, your demographic location, and the coverage opted for.
We know that’s a lot to process, and that’s why calculating the premium with a bike insurance calculator is the easiest thing to do online & to get a glimpse of the possible premium amount. All you need to do is to key in some basic information.
What are bike insurance add-ons?
Bike insurance add-ons are nothing but added benefits that most insurance companies provide to the insurers at additional cost. For example, a standard comprehensive insurance plan will cover damages to the engine that occurs due to an accident only.
But engine protection cover add-on covers the engine damage if it is caused due to factors like water ingression, or lubricant oil leakage. Most insurance companies provide add-on benefits like zero depreciation cover, roadside assistance cover, passenger accident cover to name a few. These add-ons are a great way to add a layer of protection to your bike.
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What is IDV?
As a newbie, you may have heard this term called Insured Declared Value (IDV) but if you don’t know what exactly it means, then we are here to help. So, IDV is the maximum amount that an insurance company will refund in case your bike is damaged beyond repair for reasons like major accidents, or even if the bike is stolen.
Now a lot of people have the misconception that the original cost of the bike will be refunded in total claim settlement, but let us tell you that IDV is impacted by depreciation. You will agree with us that the value of your bike reduces with every passing year, thanks to the wear and tear it sustains. So IDV is derived after subtracting the cost of depreciation.
What are NCB and its benefits?
This is another important aspect that as a beginner you should be aware of. NCB stands for No Claim Bonus – If you don’t file a claim during your policy year, the insurance company rewards you in the form of a discount on your next premium when you renew the bike insurance.
The main benefit of NCB is that the policyholders can avail of up to a 50% discount on their next renewal for the years they have remained claim-free. As a novice, you may be tempted to place a claim even for the slightest repair of your car. But you should be mindful that a claim-free year can get you a much lesser premium on your next policy renewal, which could be a significantly higher discount than the amount you would spend on getting the repair done.
Know to Claim Insurance Online
A lot of us remain clueless about how to file a claim from your insurance company in case of damages caused due to mishap. The insurance claim process online has made the process easy, thanks to technology. All you need to do is to contact your insurance company via phone or email.
After which, the insurance company will request you to duly fill the claim form, which may require you to submit documents like your proof of identity, driving license, any police FIR report (in case the bike is stolen), and the estimate of the repairs. Based on the terms and conditions your insurance company will go ahead and settle the claim.
We are sure the above information has added insightful information. With this detailed guide about insurance, you will soon be on your way to guiding others in buying the right insurance coverages for a bike. This guide will make you feel more confident than before in dealing with purchasing bike insurance
