Purchasing a two-wheeler insurance policy has been mandatory in India for a long time. The authorities have made buying a long-term five-year policy for a new motorcycle compulsory. With so much emphasis on purchasing insurance and securing your finances, buying bike insurance should be done carefully.
Remember, buying bike insurance is mandatory under the Motor Vehicle Act in India. This blog will discuss crucial things to focus on while insuring your two-wheeler.
Details to Consider While Buying Two-Wheeler Insurance
1. Type of Policy
Two main bike insurance policies exist – third-party liability only and comprehensive coverage. You must determine which type suits your needs best.
A third-party liability plan only covers financial liabilities from damages caused to a third party due to an accident involving your bike. For instance, if your bike damages another person’s vehicle in an accident, the third-party bike or car insurance would cover such losses. However, there would be no coverage under this plan if your two-wheeler suffers any damage.
Comprehensive policies provide wider coverage. Along with third-party liability, own damage protections are added, shielding you from heavy expenses in case of bike damage, theft, etc. Comparing features and claim procedures across insurers reveals precise differences between the cover types.
2. Coverage
Understanding policy coverage is vital while purchasing bike insurance. Claim-making gets easier if you comprehend the protections. Buying online bike insurance provides better coverage. Comprehensive policies usually offer:
- Theft Cover
- Fire Damage Cover
- Natural Calamity Damage Cover (flood, earthquake, landslide, etc.)
- Man-made Calamity Damage Cover (riots, vandalism, etc.)
- Third-Party Damage Cover
- Third-Party Legal Liability Cover
- Accident Damage Cover
Claims get rejected if the damage isn’t covered. Check coverage details on the insurer’s website.
3. Impact of Policy Lapse on Premiums
An important point two-wheeler owners must remain aware of is renewal discipline. Failure to pay the renewal premium for your active two wheeler insurance policy before the due date will collapse your policy.
In such cases, when you restore the lapsed policy or buy fresh insurance later, insurers will levy heavy penalty premiums for coverage – sometimes as high as double the normal rates!
Hence, it is critical for bike owners to diligently renew active insurance policies on time without any lapses or breaks. Stay updated on impending two-wheeler policy renewal dates and avoid unwanted premium hikes resulting from lapses.
4. Bike Value
Your two-wheeler’s current market value or Insured Declared Value (IDV) decides your final premium for a comprehensive policy. When purchasing bike insurance, you must set the IDV as accurately as possible based on your bike’s exact model, make and age.
The IDV can easily be calculated by knowing the approximate resale value of your bike in the market. Online insurance marketplaces and insurer websites allow you to compare IDV amounts offered across companies for the same bike make/model.
For high-end sports bikes or more recently launched models which command a greater resale value in the market, the IDV will be higher. Premiums for insuring such vehicles will also be more expensive.
5. Exclusions
Knowing exclusions, i.e. situations where claims can’t be made, is as crucial as knowing coverage details. Exclusions are listed in the policy document. Common exclusions are:
- Mechanical/Electrical Breakdown
- Regular Wear and Tear
- Accidents Due to Riding Under Intoxication
- Damages Occurring Beyond Geographical Limits
- Nuclear Reaction Damages
- Other Situations Listed as Exclusions
Like coverage, visit insurer websites to check online two-wheeler insurance exclusions.
The Bottom Line
Buying adequate two-wheeler insurance requires thoroughly understanding crucial policy aspects. Before making an informed insurance purchase choice, you must carefully consider all the above factors, including the type of policy, IDV calculation, coverage details, exclusions list, insurer reputation, the impact of lapses and depreciation norms.
Stay guarded against unfortunate incidents disrupting your bike and life!
