5 Factors to Consider While Buying Two Wheeler Insurance

Two-wheeler insurance is mandatory in India and there is no way around it. In fact, every new bike is required to have a long-term policy of 5 years. While some customers may depend on bike dealers to assist with the bike’s insurance, you always have the option of buying coverage independently. You can assess which policy type works for you and which insurance provider is offering the best price. Owning insurance to go with your two-wheeler is mandatory and we have a list of points to ponder that can help with due diligence at your end.

1. Policy Type

You have two options to choose from when looking to buy bike insurance policies. A Third-party Liability insurance and a Comprehensive Bike insurance policy. The third-party policy is fairly basic because it only covers you against damages or injuries caused to third-party. A comprehensive policy, as the name suggests, is a lot more extensive because it covers you for third-party damage and damage to your bike. While a Third-party Liability insurance is mandatory, it is suggested that one should buy a comprehensive policy due to broader coverage and a cap on incidental expenses in the event of an accident. Compare the differences in both policies before choosing one over the other.

2. Bike’s Value

How is the premium payable for a bike insurance policy determined? The Current Market Value of the bike forms the base for premium calculation of a comprehensive bike insurance policy. This value is called the Insured Declared Value (IDV). The IDV needs to be set while buying the bike insurance policy and can be calculated based on the approximate current market value of your bike. To verify the IDV amount being offered compare two-wheeler insurance. If you have a sports or high-end bike, the IDV of the bike will be higher. But if you own a basic 110cc bike, its IDV will be lower and correspondingly the premium too will be lower.

3. Policy Coverage

A complete knowledge of the extent of the policy you are considering buying is critical. It will be much easier to make a claim if you understand the coverage provided by your policy. Bike insurance online provides better coverage. A comprehensive policy provides relief from the following -

  •  Fire
  • Theft
  • Natural disasters such as earthquake, flood, landslide, tornado, hurricane etc.
  • Man-made calamities like riots, vandalism, etc.
  • Third-party damage
  • Third-party legal liability
  • Accidents

It is imperative you understand which areas are covered by the policy because any claims falling outside the purview of the policy held, will be rejected. You have the option of verifying the policy coverage online by looking up the insurer’s website.

4. Policy Exclusions

Coverage and Exclusions are two sides of the same coin. It is important to know the exclusions to be aware of the instances under which a claim cannot be raised. The policy document specifies the list of exclusions at the time of purchasing the policy. The list of exclusions will also be mentioned in the policy document while buying your bike insurance policy. Following are common exclusions:

  • Regular wear and tear, repair, usage
  • Electrical or Mechanical breakdown
  • Damage or loss as a result of speeding
  • Accident when riding a two-wheeler under the influence of an intoxicating substance
  • Damage when occurred outside India
  • Loss of keys
  • Damage due to the rider not wearing a helmet
  • Damage due to nuclear reactions
  • Any other situations mentioned in the policy document as exclusions The insurance company’s website makes a complete disclosure of the exclusions of your online two-wheeler insurance.

5. Insurance Company’s Credibility

Given the number of players in the insurance space, bike owners can take their pick based on the insurance company’s ability to provide speedy services, useful product features and overall credibility. This is especially important at the time of claims when you are most likely to need the insurance provider’s turnaround to be both prompt and efficient. Thus an in-depth research of the insurance companies in question prior to purchase of the policy will go a long way.

Social media is a transparent space that serves as a useful platform to indicate if the insurance company has satisfied or disgruntled customers. The regulator’s (IRDAI) website also provides company-wise details of the claim settlement ratio and the incurred claim ratio.

Please note buying two-wheeler insurance online is recommended.

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