The March 2021 Times of India, Chennai edition reported that, according to police statistics, approximately 60 motorbikes were reported missing in a month, and in 2020, about 740 bikes went missing from residential areas. Most of these bikes are untraceable, and the only alternative may be to declare it a total loss. But do you know that you can claim ex-showroom costs and a few expenses from your insurance provider if you have a return to invoice cover?
This cover is not part of a standard bike insurance policy. One must buy a return to invoice add-on cover by paying an extra premium. So, while purchasing or renewing, the total premium will include the premium for both base and bike insurance add-on cover. Let's learn more about the return to invoice add-on cover.
What is a Return to Invoice Cover?
Comprehensive bike insurance not only acts as a shield by covering damages to the insured motorbike and damages or injuries to third parties or their properties from the insured bike but also covers total loss arising from theft.
However, in the case of claims for loss due to theft, the insurer will only pay the sum assured amount or the insured declared value (IDV) in bike insurance. However, if the insured adds an RTI cover to their regular comprehensive bike insurance policy, they can receive the maximum payout - the ex-showroom bike cost, registration cost and taxes.
Total Loss of a Two Wheeler
Suppose the bike meets with an accident or is exposed to a fire or flood or any other such situation covered under a two-wheeler comprehensive insurance. The damage is beyond repair. In that case, it will be treated as a total loss. Suppose the bike insurance policy is supported with an RTI cover. The insured can claim total compensation up to the motorcycle's purchase price or invoice value.
RTI Add-on – When to Raise a Claim?
The right time to claim total compensation with an Return to invoice bike insurance add-on cover is when
- The bike is stolen and declared untraceable.
- The damage to the bike is beyond repair.
Who Must Buy a Return to Invoice Cover?
Like a comprehensive bike insurance policy, an RTI cover needs to be renewed every year, and the renewal cost depends on the bike's updated invoice value. An RTI cover is of much importance to the following category of people:
- To biker with a brand new bike.
- The age of the motorcycle is three years.
- Expensive bikes or bikes in the superbike category.
- Bikers who park their bikes by the road, especially at night
- Interior localities with CCTV facilities.
- Reside in an area where many bike thefts are reported.
How does a Return to Invoice Cover Help?
An RTI has a specific purpose: to reimburse the biker if the damage to the bike is beyond repair or if someone steals it and the police file declares the bike untraceable. Here is how the RTI cover benefits the insured:
- The RTI cover works alongside the comprehensive bike insurance policy to offer complete cover if the bike is stolen or total loss of the bike.
- Suppose the bike has only a comprehensive bike insurance policy; he will only receive the current market value minus depreciation or IDV as compensation, but if an RTI supports the comprehensive approach, he will receive the total purchase price of the bike.
- Certain calamities like fire, riots, accidents, vandalism and floods can destroy a motorcycle resulting in total loss. But if the bike has a comprehensive bike insurance policy and RTI cover, they will get back the value as per the invoice of the bike.
- An RTI cover helps the two-wheeler owner relax as they will be reimbursed if the bike is totalled or stolen.
- A bike costs a biker much more than the ex-showroom cost. He will need to pay registration charges, road tax, etc. RTI add-on covers those expenses also.
How to Raise a Claim for Theft?
Here is a 5 step approach to claim compensation if you have comprehensive bike insurance and an RTI add-on for the bike.
- As soon as the biker learns that the bike is not in its place and after good searching does not find it, he must file an FIR at the nearest police station and alert the insurance provider and the RTO. It is a mandatory requirement.
- Compile the necessary document (you will find the list in the next section) to submit to the insurance company.
- Wait for a month from the date of the FIR, and if the bike is not found, obtain an untraceable report from the police and submit it along with the relevant document to the insurance provider.
- The insurer will verify the submitted documents, and if they are in order, it will process the claim and pay the compensation.
Essential Documents to Effect a Claim
The bike owner needs to submit the following documents to the insurer to authenticate the bike insurance claim.
- Bike insurance policy of the stolen bike.
- Claim settlement form with the necessary details.
- The RC book or the certificate of registration of a motorbike.
- The duplicate copy of the rider's driving licence.
- Orignal FIR of the missing bike.
- A letter of intimation of the theft to the RTO.
- RTO transfer documents.
Compensation Payment Methods
Suppose the biker buys the two-wheeler by securing a loan; the insurer will pay the entire amount to the financier of the loan. However, the biker will have to pay the loan balance.
However, if the bike is not on loan and the biker bought it with his own money or received it as a gift, the insurer will pay the total payout amount to the insured.
An RTI add-on is an added expense and adds to the cost of a comprehensive bike insurance policy. But you can rest easy as it ensures full payment in case of bike theft or damage beyond repair. An RTI will compensate the bike's purchase price including the amount spent on road tax and registration. In the absence of an RTI add-on, the biker would have to contend with the IDV, which only decreases periodically due to depreciation.
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