A motorbike is convenient and easy to ride in the city but is more prone to damage by accident. Bike owners must, therefore, carefully plan their bike insurance purchases. A third-party bike insurance policy is excellent for paying damages to a third party from an insured bike. However, it does not cover the damage to the insured bike.
For this reason, city riders buy a comprehensive bike insurance policy to cover damages to their ride. But what happens when the biker falls off his bike and is injured?
Bikers would then need a personal accident cover to shield them against medical costs. It is thus advisable to buy add-on covers to make a bike insurance policy give you the maximum coverage. Read the article for those hacks that make the existing bike insurance the best for city riders.
What Amount of Insurance Cover is Needed?
The IRDAI does not permit a bike insurance policy cancellation except in exceptional cases. Thus, bike owners must carefully decide on the insurance plan. Before applying for an insurance cover for the motorcycle, the owners must compare quotes and choose the one that suits their requirements.
Some bike owners, while comparing quotes, only check the prices and pick the least expensive one. However, this will not help. Compare costs by looking at the inclusions and exclusions, then decide which is the best insurance policy. It is also advisable to check the financial soundness and how the company settles claims before investing in bike insurance.
A crucial point to consider is 3rd party insurance, without which city riders risk facing fines and imprisonments. However, it does not cover damages to the insured bike. So, look to buy a comprehensive bike insurance policy to ensure both third-party and own vehicle insurance claims.
Choose the Right Sum Assured Amount or Insured Declared Value
What do bikers do when their comprehensive bike insurance policy expires? They pay the premiums and get themselves bike insurance coverage for another term. However, that does not add value to the two-wheeler policy because the purchase decision is not dependent on the total value of the bike or insured Declared Value (IDV).
So what is IDV? It is the market value of the two-wheeler at the time of the bike insurance policy renewal. The IDV of two wheeler insurance does not include road tax, registration charge, insurance cost and depreciation. So, if the purchase price excluding these costs was INR 82,000, its IDV after two years but before three will account for depreciation at 30%. The depreciation comes to 24,600. The IDV after deduction of depreciation is INR 57,400 (INR 82,000 - INR 24,600 (30 x 82000 / 100) = INR 57400).
The IDV is of utmost importance as that is the amount the insurance provider pays to settle claims if the bike has suffered extensive damage, is not worth repairing, or is stolen. Thus, it is essential to consider the IDV and pay an appropriate premium at the renewal of a comprehensive bike insurance policy.
Cost of Insurance is Dependent on the Cubic Capacity of the Motorbike
The output power of a two-wheeler depends on its cubic capacity (cc). As per the IRDAI rules, the bike insurance price is proportional to the cubic capacity of the two-wheeler’s engine.
It means the lower the cc, the lower the bike insurance price. Thus this holds good only for a third-party bike insurance policy. The standard bike insurance premium for third-party insurance in India is as follows:
|Cubic Capacity of a Two-Wheeler||Standard Third-party Insurance Price in India|
|Not more than 75cc||INR 538|
|Higher than 75cc but lower than 150cc||INR 714|
|Higher than 150cc but lower than 350cc||INR 1,366|
|Above 350cc||INR 2,804|
Note - Taxes at a specified rate will apply over the base premium.
But there is no fixed bike insurance price when it comes to comprehensive bike insurance plans, which is because third-party bike insurance depends on the CC of the bike. Still, a comprehensive bike insurance premium depends on how the insurance provider assesses the risk and the IDV value of the two-wheeler.
Choose Add-ons to Suit Individual Requirements
Bike insurance add-on covers are excellent buys because they vastly improve the coverage of a standard two-wheeler policy.
Some of the best value insurance covers are zero dep insurance for bikes, road assistance cover, personal assistance cover, key loss cover, engine cover, consumables cover, NCB protection cover, daily allowance cover, tyre damage cover, return to invoice cover and loss of per personal belongings cover. So, how do add-ons add value to your bike insurance policy?
Here is an instance:
Raju was in a hurry to get to work, and his bike worked fine until he hit the brakes and stopped at the last traffic signal opposite his workplace. When the light turned green, his bike refused to start. Could he leave the bike there and rush to work? Surely not.
If he did, that would be a violation and earn him a ticket. Instead, he intimated the insurer, which sent the surveyor to check the bike's condition. After getting the nod from the surveyor, Raju slowly moved the bike to a service road and called one of the cashless garages listed in his insurance policy. The team arrived in 5 minutes and moved the bike to the garage. Raju could return to work on time and get back his repaired bike quickly.
City life is hectic, and people are always in a hurry. This leads to an increase in unintended damage to the bike. It thus becomes necessary to have a high-value insurance policy with necessary add-ons to cover all kinds of damages and facilitate quick settlements and renewals to help in the most challenging situations.