10 Things to Check Before Buying Bike Insurance in India

Riding a motorcycle is a thrilling and fun experience, but it comes with its own dangers. Accidents, theft, damage due to natural calamities, etc. are some of the common risks associated with owning a bike. This is why you need bike insurance. It can provide you with financial protection in case of such unexpected incidents - making it a valuable investment.

However, buying bike insurance requires careful consideration and attention to detail. You need to evaluate various factors including policy coverage, premium, deductibles, add-ons, and the insurer's reputation to select the right coverage that suits your needs and budget.

In this article, we’ll discuss some of the important things to keep in mind before buying bike insurance.  So, let’s kick off!
 

Things To Consider Before Purchasing Bike Insurance

Here are some of the things to keep in mind to ensure you make a worthwhile purchase -

• It is a Mandatory Requirement by Law

  As per the Motor Vehicles Act, 1988 (Section 146), having at least a third-party insurance policy for your bike is mandatory. Riding without valid insurance can attract a fine of Rs. 2,000 and/or imprisonment of up to 3 months under the Motor Vehicles (Amendment) Act, 2019. So, before you hit the road, make sure you have a valid insurance policy to avoid any legal repercussions.

• Know the Types of Bike Insurance Policies

  Here are the three types of bike insurance policies available in the market –

  • Comprehensive Insurance

    Comprehensive insurance provides extensive coverage against any damages caused to third-party individuals or their property as well as any damages or losses caused to your bike. For example, imagine you are riding your bike and accidentally hit a pedestrian. Not only will your comprehensive insurance cover the damages to your bike, but it will also cover the medical expenses of the pedestrian in case of death or permanent/partial disability and any damages caused to their property.

  • Standalone Own Damage

    Standalone Own Damage insurance covers only the damages caused to your bike. However, you can purchase this type of policy only if you have an existing third-party policy.

    For example, let's say you have standalone own damage insurance. While driving, you accidentally crash your bike into a wall. This causes severe damage to the headlights. Since you have standalone own damage insurance, you can claim the damages caused to your bike from your insurer.

  • Third-Party Only

    This type of plan provides coverage solely for damages caused to a third party or their property. Any damages caused to your own vehicle will not be covered under this policy.

    For example, say you are driving your bike and accidentally hit another vehicle. In this case, your third-party insurance policy will cover the damages caused to the other vehicle or property, but you will have to bear the costs of repairing your bike.

  Note: Mandatory Requirement

  Additionally, as per IRDAI's directive (in line with a Supreme Court order), all new two-wheelers purchased must be covered by a 5-year third-party insurance policy upfront at the time of purchase. The own-damage (OD) cover under a comprehensive policy, however, is annual and must be renewed every year.

  Since June 2019, IRDAI allows the separate purchase and renewal of Third-Party (TP) and Own Damage (OD) covers. This means you can continue your TP cover with one insurer and renew your OD cover with a different insurer at renewal, allowing you to shop for better pricing or benefits on your OD policy independently.

• Understand the Coverage

  When it comes to choosing a bike insurance policy, it is important to understand the coverage provided by different types of policies. As mentioned earlier, there are 3 types of policies –

  • Comprehensive
  • Standalone own damage
  • Third-party only

  You should consider purchasing a policy that aligns with your needs and requirements. It is important to understand the inclusions and exclusions and choose a policy that provides adequate coverage.

• Check The Insured Declared Value (IDV)

  The Insured Declared Value (IDV) refers to the amount of compensation you will receive from the insurance company in the event of theft or total loss of your bike. It is the maximum amount that the insurance company will pay you, and it is important to set the IDV appropriately to ensure that you receive adequate compensation.

• Maximise Your Policy Coverage with Add-ons

  While a standard policy can provide you with basic coverage, there are several add-ons available that can enhance your protection. Some of the add-ons include a zero-depreciation cover, personal accident cover, engine protect cover, etc. By evaluating your needs and purchasing the right add-ons, you can get the most out of your bike insurance policy.

  A Compulsory Personal Accident (CPA) cover of Rs. 15 lakh for the owner-driver is mandatory under IRDAI regulations for all bike insurance policies, whether third-party or comprehensive. This cover compensates for permanent disability or death in a road accident. The only exemption is if the owner already holds a separate personal accident policy covering at least Rs. 15 lakh.

• Compare and Choose the Right Premium for Your Insurance Policy

  Premiums are a crucial factor of consideration when it comes to choosing an insurance policy. A premium is the payment you make to the insurer in exchange for the coverage and services they offer. While you definitely don't want to overpay for your policy, you also don't want to skimp on coverage! So, what can you do to ensure the right balance?

  • Compare Premiums: The first step is to compare premium rates from different insurance companies. Don't finalize the first insurance policy you see. Instead, get quotes from multiple providers.
  • Balance Coverage and Price: Make sure you are selecting a policy that has a balance of coverage as well as the price. Look for a policy that provides you with the coverage you need at a price you can afford.
  • Look for Discounts: Certain insurance providers provide premium discounts, which can help you save more.
• Save More with a No-Claim Bonus

  The NCB discount starts at 20% for the first claim-free year and increases progressively with each consecutive claim-free year, up to a maximum of 50% after 5 continuous claim-free years. These rates are set by IRDAI and are uniform across all insurers. Importantly, NCB applies only to the own-damage (OD) component of your premium, not to the third-party premium. NCB also belongs to the policyholder, not the vehicle, and can be transferred to a new bike or a new insurer. Crucially, if the policy is not renewed within 90 days of expiry, the accumulated NCB is forfeited entirely.

• Know the Importance of Proper Documentation

  When purchasing a bike insurance policy, it is crucial to have all the necessary paperwork in order to ensure a smooth and hassle-free process. This includes documents like your registration certificate (RC), driving license, previous policy documents, etc.

  Digital copies of your bike insurance policy stored in the DigiLocker app are legally valid and accepted by traffic police during vehicle checks — making it convenient to always have proof of insurance on hand.

• Choose the Right Insurance Company

  Choosing the right insurance company and understanding their claims process is vital when buying insurance. In the event of an accident, you want to be sure that your insurance company is there for you and that the claims process is straightforward and hassle-free. This is why you will need to research the claims process, look for reviews and ratings from other policyholders, etc.

• Check the Customer Service

  The insurance company you choose should have a helpful and robust customer service team that can assist you with claims, resolve policy-related questions, etc. The team should be responsive, knowledgeable, and able to help you with a wide range of issues. It should also provide convenient communication options, such as phone, email, live chat, etc.

To conclude,

When purchasing bike insurance, it is important to consider factors such as coverage, IDV, customer service, etc. Evaluating these factors ensures that you select a policy that meets your needs, with which you can be assured that you are financially protected in case of any unforeseen circumstances.