"A two-wheeler insurance policy is essentially an agreement between an insurance company and an individual wherein the insurer covers any damage incurred by the two-wheeler in case of an accident, natural disaster, or theft"
A bike insurance plan offers protection against liabilities that arise from injuries to the rider and the pillion as well as third parties, depending on the kind of policy you purchase. In order to purchase the cheapest two-wheeler insurance policy with adequate coverage, it is essential to compare plans between insurers.
Importance of Two-Wheeler Insurance in India:
Riding your bike without a valid two-wheeler insurance plan is considered illegal. Two-wheeler insurance policies are designed to offer financial coverage against unfortunate events and accidents that could damage the insured two-wheeler or bodily injuries to the rider, the pillion, or pedestrians, or damages to the property of a third party. With a proper bike insurance policy in place:
1. You will be free of financial stress: In case your vehicle is damaged or stolen, you won’t have to worry about the costs incurred in fixing it or replacing it as the insurance company will take care of it.
2. You will have legal protection: Considering the fact that it is compulsory to have an insurance policy in place when riding on Indian roads, carrying a copy of your insurance policy will ensure that you will be legally protected against paying fines or penalties.
3. You will receive a personal accident cover: If you are insured, the insurance company will provide cover (up to a certain amount) in case you suffer total permanent disability. In case the policyholder passes away, your family will receive the sum assured from the insurance company.
4. No Claim Bonus:You will be able to enjoy benefits like No Claim Bonus (NCB).
Types of Bike Insurance:-
1. Comprehensive Insurance:
A comprehensive two-wheeler insurance policy, although not mandatory, is highly recommended for all bikes. This insurance plan offers extensive coverage to the bike and its owner. It also protects policyholders from legal liabilities to third parties in an accident.
2. Third-Party Liability Insurance/Liability-only insurance:
A third-party liability insurance plan provides coverage against losses or damage caused by the insured two-wheeler to a third party or his/her property. Two-wheeler Owner may also receive coverage in the form of a personal accident cover, but no coverage will be provided for the theft or any damage.
What Does Third Party Insurance Cover?
It is mandatory as per law to have an insurance policy that covers third party liabilities at least. This is according to the Motor Vehicles Act, 1988. Third party insurance offers this coverage. Third-party insurance is most common in motor insurance policy. Any third party involved in the accident will be provided coverage under this policy. IRDAI will be evaluating the damages before deciding if the claim is valid or not. The following are the coverages of a third-party two-wheeler insurance plan:
1. Bodily injury or death to third party.
2. Property damage.
3. Permanent total disability of driver or bike owner*.
4. Death of driver or bike owner*.
5. Personal accident cover for pillion rider.
Apart from the legal aspects, third party insurance can be very useful in case a third party or a third-party property is involved in the incident. The victim in the accident can register a case to claim compensation. This is where third party insurance comes into play. This will cover all liabilities that will arise due to death or damage to third party or third-party property.
Third-party insurance will cover any damages or injuries incurred by a third party or third-party vehicle at the time of an accident. Any damage to property belonging to a third party will also be covered under this policy. This policy will not cover any damage incurred by the vehicle of the policyholder. You will have to purchase a comprehensive motor insurance policy if you wish to get this coverage.
What is a Comprehensive Two-Wheeler Insurance Cover?
A comprehensive insurance policy covers damage, loss, or theft of your two-wheeler. Comprehensive insurance policies cover any damage incurred by the owner of the two-wheeler. Opting for a comprehensive insurance policy is not mandatory like liability only cover. Here are the features of a comprehensive two-wheeler insurance plan.
1. Personal accident cover
2. Offers protection for costs incurred due to accident.
3. Coverage against third party liability
4. Coverage against death or bodily injury
Comprehensive insurance policies will not cover any damages caused due to electrical or mechanical breakdown or the normal wear and tear of the vehicle. Coverage will not be provided if the vehicle is driven without a valid driving license at the time of the incident. Damages incurred while driving under the influence of alcohol or any other intoxicant shall not be covered under a comprehensive two-wheeler insurance policy.
Unlike liability only insurance, there are several add-ons you can opt for to improve the coverage. Roadside assistance return to invoice, pillion rider, and zero depreciation are some of the popular add-on covers available. Even though a comprehensive insurance policy is more expensive when compared to a liability-only policy, the amount of coverage offered under this plan will help you save a lot of money in case you meet with an untoward incident. Comprehensive insurance policies are the best option to choose as the policy offers extensive coverage when compared to liability only policies.
Comprehensive Cover Vs. Liability Cover:
A comprehensive two-wheeler insurance policy is the best type of plan available for bikers. It provides comprehensive protection against damages to your vehicle as well as damages to the vehicle or property of a third party. It also protects the policyholder against the theft or loss of his/her two-wheeler. However, the premium for a comprehensive policy is much higher than that of a liability-only policy. It is advisable for all inexperienced riders to opt for a comprehensive insurance policy for their bikes.
Features of Two Wheeler Insurance:
The following are the key features of a two-wheeler insurance policy:
• Bike insurance policies are categorised as motor insurance policies that are part of the general insurance industry.
• Motorcycle insurance plans provide financial coverage against damages incurred by the insured vehicle as well as theft of the vehicle.
• In case your two-wheeler insurance policy has expired, all the damages incurred by your vehicle will have to be borne by you.
• Bike insurance plans offer coverage against natural disasters as well as man-made calamities such as earthquakes, storms, landslides, riots, theft, explosions, strikes, etc.
• In case of the loss or theft of your vehicle, a pre-determined sum assured up to the Insured Declared Value will be provided to you.
• When purchasing a bike insurance policy, you will be required to pay a pre-specified premium to the insurance company over regular intervals of time for a certain period.
• Premium rates are cost-effective and can be negotiated with the insurer at the time of purchasing the policy. Premium amounts start from Rs.600.
• The personal accident cover on bike insurance is limited to Rs.1 lakh for damages incurred by the insured vehicle as a result of an accident.
• Discounts of up to 70% of the premium can be claimed through the no-claim bonus offered by most two-wheeler insurance companies.
You can choose the kind of coverage you require from liability only and comprehensive two-wheeler insurance plans. The Indian Motor Vehicles Act has made it mandatory for all vehicles to be covered by a liability only policy. It provides coverage against wear and tear of your two-wheeler. The following are the factors you should consider when purchasing two-wheeler insurance:
1. Instant policy:
Customers who wished to purchase or renew their bike insurance plan, until recent years, would be given a cover note instead of the policy itself. They would receive the original policy document only after a few days as insurers would mail it to their address at a later date. Thanks to advancements in technology and quicker banking facilities, nowadays, you can get a digitally signed policy from the insurance company as soon as you make the payment.
2. Simplicity of Transferring No Claim Bonus:
In case you purchase a new two-wheeler, transferring the No Claim Bonus is a process that has been made relatively simple by insurance companies. The bonus is transferred in the name of the owner or the driver of the vehicle, and not the vehicle itself. The No Claim Bonus is given to drivers and vehicle owners because of the safe driving practices followed by them and not making any claims in the previous year(s).
3. Optional Covers:
Optional covers include increased cover for accessories and spare parts, personal accident cover to protect pillion riders, zero depreciation cover, etc. You can purchase these covers at a nominal fee and increase the level of protection for your vehicle. These covers come in handy in times of unfortunate or unforeseen events.
4. Discounts:
Insurance companies that are approved by the Insurance Regulatory and Development Authority of India offer discounts for a few factors like membership of reputable automotive associations, lower premiums for vehicles fitted with approved systems such as anti-theft devices, etc. Even those who have two wheelers and have an unblemished record are eligible for discounts in No Claim Bonus.
5. Online Purchase and Renewal:
Bike insurance plans can be purchased and renewed online with relative ease. Many insurance companies also have mobile apps that make it convenient for customers to purchase or renew their policies. Considering the fact that all details of the policy are stored in the database, the renewal process is relatively simple and happens very quickly.
Benefits of comparing various Two-Wheeler Insurance Plans:
The following are the main benefits of comparing two-wheeler insurance policies:
1. Save money:
One of the biggest benefits of comparing two-wheeler insurance policies is that it can help you save a lot of money by helping you purchase the most reasonably-priced policy.
2. Proper protection:
When you compare two-wheeler insurance policies, you expose yourself to various options. Reading the features and benefits of the various options at your disposal can help you find the best policy.
3. Add-on covers:
When you compare insurance policies, look for add-on covers as they will enhance the level of coverage offered to you.
4. Insured Declared Value:
Comparing the Insured Declared Value (IDV) offered by an insurance company will help you make an informed decision when purchasing a two-wheeler insurance plan.
How to Compare and Choose a Bike Insurance Policy?
Selecting the right two-wheeler insurance policy can be a tedious task as it involves a lot of research and comparison. There are various insurance companies around the country and picking one that caters to your unique insurance needs can be a tough thing to do. Mentioned below are the elements that you must consider while comparing multiple two-wheeler insurance policies:
• Comparison of the kind of coverage you need (comprehensive or third-party liability only)
• Comparison of the Insured Declared Value
• Comparison of premiums
• Comparison of cashless network garage list
• Comparison of add-on covers
Here are a few things that must be checked when comparing two-wheeler insurance plans:
Kinds of Cover:
The covers for bike insurance are usually of two kinds, comprehensive cover and liability only covers. While a large number of people go for liability only policies due to the fact that they are mandatory under the Indian Motor Vehicles Act, a comprehensive two-wheeler insurance policy is a better option as it comes with many benefits. When comparing policies, it is crucial to first understand what kind of cover you need.
Optional covers or add-ons:
Insurance companies across the country offer add-on features or optional covers that increase the level of coverage provided by the base policy. These covers could be additional features that take care of wear and tear of the two-wheeler, offer accident cover for co-passengers, etc. Some covers like zero depreciation come in handy as they ensure that you do not incur extra costs on depreciation of parts of the vehicle.
Features and facilities available
Several insurance companies across India are very customer savvy in the sense that they have designed a number of features and benefits that aid customers in the claims process. For example, all insurers have a 24/7 customer care support that makes it easy for customers to get assistance at any time. The customer care support facility can help you get the best advice on renewals, claims, NCB transfer, etc.
Claims Process:
Considering most insurance companies are customer-oriented, their claims process is relatively simple, and you can file claims with no hassles. The entire claims process includes a few steps like intimating the insurer about the claim, filing a FIR with the nearest police station, transporting the two-wheeler to the garage, furnishing the necessary documents along with the claim form, etc. In many cases, the insurer tends to cover all the costs incurred as a result of an accident, with the owner of the vehicle having to bear certain expenses that are not covered by the insurance policy, such as the taxes and service charges. Considering the complexity of the claims process, you can avail yourself of help from the insurance company.
Renewal Process:
Insurance companies have made it relatively easy for customers to renew their motorcycle insurance policies online. In case your policy has expired and you do not wish to renew it as you want to purchase another policy, you can do so easily on the website of the company from which you purchased the plan.
Availability of discounts:
When you compare two-wheeler insurance policies, it is advised that you go for companies that provide concessions and discounts for certain factors like membership of reputed automotive associations, no claim bonus (NCB), inclusion of anti-theft systems, etc. Some companies also offer extra discounts on online renewal, purchase of a policy using a credit card etc.
Two-Wheeler Insurance Add-on Covers:
When you purchase a two-wheeler insurance policy, you get covered against unforeseen circumstances that could make you incur major expenses. While comprehensive two-wheeler insurance policies offer basic insurance coverage, going for optional riders or add-on covers will significantly increase the level of protection afforded to you. Most insurance companies offer add-on covers with their bike insurance policies. Each add-on cover has its own benefits, thereby allowing you the luxury of choice to pick only the ones that will suit your unique insurance needs. The following are the optional riders to choose from:
Personal Accident Cover for Pillions: When you supplement your bike insurance policy with a personal accident cover for the pillion, your financial liability can be lowered significantly in case of accidents where the pillion rider is injured. This add-on feature provides coverage for the death or permanent or partial disability of the pillion rider.
Roadside assistance: By purchasing the roadside assistance add-on cover, you can avail roadside assistance at any time in case of a mechanical failure or the breakdown of your vehicle. This feature offers facility such as free towing, immediate repairs, etc. and it comes in very handy especially when you are travelling to a remote place where it could be difficult to find help.
Accessories cover: Having this add-on cover will provide coverage for all the accessories of the two-wheeler, electrical or non-electrical. In case any of the accessories of the vehicle are damaged, the rider will cover the cost to repair or replace it.
Consumables cover: The consumable cover can be of great help when it comes to receiving compensation for costs incurred on nuts, bolts, engine oil, etc. Since consumables are not covered under basic two-wheeler insurance policies, purchasing this optional rider will ensure that you are financially covered for the aforementioned costs.
Zero depreciation cover: Whether you purchase a liability only insurance policy or a comprehensive two-wheeler insurance policy, the whole claim amount will not be settled by either of them. Depreciation is deducted by the insurance company and only the remaining amount is paid out. Supplementing your bike insurance policy with a zero-depreciation cover, however, will eliminate the depreciation factor and you will be eligible for the whole claim amount.
Daily cash allowance: The daily cash allowance add-on cover is ideal for those who commute solely on two wheelers. In case your bike is seriously damaged and is undergoing repairs at a garage, you may have to incur out-of-pocket expenses to travel without it. Adding the daily cash allowance cover to your two-wheeler insurance policy will mean that your insurer will give you a certain amount of money per day to meet your travel expenses.
Engine cover: The engine cover can come in very handy if the engine of your two-wheeler or the ancillary circuit gets damaged because of flooding or waterlogging. Considering the cost of repairs to engines can extend to several thousands of rupees, the engine cover will cover these expenses and allow you to have total peace of mind.
Return to invoice cover: When you purchase a two-wheeler, there is always a risk that it could be stolen. Since the value of every machine depreciates over time, the value of your bike will be relatively lower after a period of, say, six months. However, purchasing the return to invoice cover to supplement your motorcycle insurance policy will mean that you will be reimbursed the actual value of the vehicle in case it is stolen or suffers total loss due to natural calamities or theft.
Since each of the aforementioned riders has its benefits, you can pick as many options as you want to extend the level of protection available to your two-wheeler. These riders are available for a nominal fee and come in very handy in times of emergency.
Inclusions of Two-Wheeler Insurance:
The policy document will cover all the inclusions and exclusions of your motorcycle insurance plan. Generally speaking, the following are the inclusions and exclusions of a two wheeler insurance policy:
• Natural events: A bike insurance policy provides coverage for damages caused by natural calamities such as fires, earthquakes, inundations, hurricanes, self-ignitions, floods, storms, lightning, hailstorms, frost, cyclones, tempests, rockslides, etc.
• Man-made events: Two-wheeler insurance policies also provide coverage for damages caused by man-made calamities such as thefts, burglaries, strikes, riots, etc., even when the two-wheeler is being transported from one location to another by air, waterways, railways, or road.
• Legal third-party liability: A 2-wheeler insurance policy provides cover against any legal losses that are incurred because of injuries to a third party. It also covers the death of a third party in addition to providing cover against damages to properties of third parties.
• Personal accident coverage: In case the owner or a driver of a two-wheeler meets with an accident, a personal accident cover to the extent of Rs.1 lakh will be provided as cover for permanent or temporary disabilities or loss of limbs resulting in total or partial disability.
Exclusions of Bike Insurance:
The following are the general exclusions of a two wheeler insurance policy:
• Damages incurred by normal wear and tear of the two-wheeler.
• Losses incurred due to electrical or mechanical breakdowns.
• Damages to tubes and tires.
• Consequential losses or depreciation from regular use of the vehicle.
• Losses incurred by the vehicle when it was being used for illegal purposes.
• Damages or losses incurred by the vehicle when it was being used by someone who does not have a valid driving license.
• Damages or losses incurred by the vehicle when the driver was using the vehicle under the influence of drugs or alcohol.
• Damages or losses incurred by the vehicle due to mutiny, war, or from nuclear risk.