Simple Guide to Buying Insurance for a Second-hand Bike in India
Buying a second-hand bike is harder than buying a new one. You need to make sure that the bike is kept in good condition, the paperwork is updated and the asking price is worth it. A pre-owned or second-hand bike is usually less expensive. But it demands the necessary two-wheeler insurance cover. You may think it is unnecessary since the bike is used but having a bike is a responsibility in itself. Apart from the legal liabilities, you will be surprised to find the benefits of a two-wheeler insurance plan for second-hand bikes. Read on to know the advantages and ways to financially secure your pre-owned bike.
What is Second-Hand Bike Insurance?
Bikes are a convenient medium of transportation in metros and towns. They help you navigate through small lanes and zoom through the traffic lights. Their smaller size, high mileage and low cost of maintenance make bikes far more popular than four-wheelers. Since second-hand bikes are less expensive, many owners neglect the bike insurance.
Is it necessary to get two-wheeler insurance for your second-hand bike?
As per the Motor Vehicles Act of 1988, it is mandatory to have an active Third Party Insurance policy. bike protection for your pre-owned bike or bike isn't just a required report, however, it offers a few advantages. Here is the reason second-hand bike protection is significant:
Third-Party Liability insurance protects you from legal obligations emerging out of damages or losses to a third party person or property. The second-hand bike protection will take care of the expenses arising due to an accident. As per the Motor Vehicle Act, it is mandatory for all vehicles to have at least a Third Party Liability cover. Therefore, it is equally important for second-hand bikes to carry an insurance cover. This will provide financial security against damages suffered by a third party person or their property.
Theft of the Insured Bike
The thought of losing your savings along with your bike can be stressful. Imagine your second-hand bike being stolen. In such cases, a valid two-wheeler insurance plan will help you stay financially secure.
*PRO-TIP: In case of theft, under a Comprehensive Cover, your Bike insurance provider will compensate the amount equivalent to the IDV of your bike.
Unforeseen natural disasters like floods or earthquakes can lead to serious damage to your second-hand bike. Your bike may suffer damages or sometimes may even be left unrecoverable. Under a Comprehensive two-wheeler insurance cover, your insurance provider will pay the Insured Declared Value (IDV) or the market estimation equivalent for your bike.
Riots, strikes, etc may cause damages to your vehicle. The expenses of repairing, in such cases, will be borne by the insurance provider. Having a bike insurance plan guarantees that your bike will be protected financially at all times.
Own Damage Cover
In case of an accident, you may notice scratches and dents on your own bike. These damages are considered Own Damage and you can file for a claim under a Comprehensive bike insurance policy. Apart from the third party liabilities, a Comprehensive Cover also manages the cost for fixing the insured bike. This makes the Comprehensive cover very useful, especially in times of troubles.
How to get an Insurance Policy for your second-hand bike?
You can get an insurance plan for a pre-owned bike by either transferring the policy in your name or buying a new one; if the old one has expired. You can purchase bike insurance online from insurance agencies. Here are the steps:
- Visit the insurance agency's site.
- Submit or scan your bike’s records, for example, the registration certificate and your ID. You can even get a bike insurance quote based on basic details like your bike’s registration number.
- Once you have the quote, compare different products on the basis of their coverage, inclusions, Add-ons etc.
- After you have finalized your insurer, you need to pay the premium amount. If your transaction is successful, you will receive a copy of your policy document will be sent to your email address.
Documents Required to Purchase Second-Hand Bike Insurance:
Like a standard bike insurance plan, the documents needed to buy second-hand bike insurance are the same. You will need the following:
- Updated Registration Certificate (RC) with the new owner's name.
- Existing Insurance Policy papers of the bike.
- Address verification documents, for example, Aadhaar, Passport, or Voter's ID
- Passport-sized photos.
Add-on Covers for Second-Hand Two-Wheeler Insurance:
Just like a bike insurance plan for any other bike, there are add-on covers available for second-hand bikes too. These covers provide extra advantages and improve the scope of coverage offered for your bike. Since Add-on covers are not mandatory, you can choose them based on your needs. The following are some of the most common Add-on covers for second-hand bike’s protection:
Return to Invoice Cover (RTI)
In case of damage to your vehicle during an accident or theft, your insurance agency will only pay the current market estimate or the IDV of your bike. However, with the Return to Invoice add-on, the insurance plan will cover up the entire amount equivalent to the first receipt estimation of the bike. This includes additional charges as well as taxes.
Nil or Zero Depreciation Cover
To safeguard yourself financially in case of a mishap to your second-hand bike, it is recommended to opt for Zero Depreciation Cover. Following an accident, the changing of parts and other repairing cost is paid by the insurance agency without any devaluation of the parts. As the name suggests, a Nil or Zero Depreciation cover guarantees that your insurer cannot consider any depreciation at the time of claim settlement.
Engine Protection Cover
Under a standard insurance plan, the engine of your bike is not covered. If there is any damage to your engine due to accident, your insurance provider can straightaway reject the claim. Even in the case of substitution of the engine parts, due to floods, you will have to bear the bill. But with the Engine Protection add-on, the insurance provider will have to compensate the entire amount for fixing or changing the engine.
Picture yourself in the middle of a highway with a punctured bike tire. To make things worse, your bike will not start, you clearly need help. Roadside Assistance is a type of emergency aid add-on that will provide you with all the help you may need in case of a breakdown. Since it is active 24*7 during your policy term and active PAN India, it is recommended for bikers and solo travellers.
Motor oil, spare parts, screws, etc are considered consumables as per a two-wheeler insurance policy. At the time of claim settlement, these are not covered under the standard Comprehensive bike insurance plan. Consumables Add-on cover manages the expense of these consumables.
Things to Keep in Mind While Insuring a Used Bike:
Here are a couple of things you should know before purchasing your second-hand bike:
- Check if the new RC is in your own name.
- Check the Insured Declared Value (IDV), the market estimation of the bike. This is the maximum sum paid in the case of theft.
- Higher inclusion will offer the greatest protection for your pre-owned bike.
- If you have a valid bike insurance plan if the bike you are planning to sell, make it a point to transfer the No Claim Bonus (NCB) to enjoy discounts on your next policy purchase.
- You can opt for a few extra covers, for example, Invoice Protection, Nil or Zero Depreciation, etc. These additional covers will offer additional advantages apart from your standard two-wheeler insurance policy.
- If you are changing your insurance agency, research about new insurance agencies, their products and Claim Settlement process before you pay for the insurance policy for your second-hand bike.
How to Transfer Bike Ownership and Insurance starting with One Person then onto the next?
The process to transfer bike ownership is extremely easy if you follow certain steps. This will guarantee a smooth transition of the bike from the seller to the buyer. As the seller, it is your responsibility to report the Regional Transport Office (RTO) about the transfer of your vehicle. It is also important to ensure the RC is updated with the new owner's name. The process to transfer bike insurance to the new owner is relatively easier. With all insurance-related processes moving online, you can raise a transfer request from your smartphone. You will need to provide documents, for example, RC, address proof, and the original insurance policy of the vehicle to initiate the process.
Summary: Owning a second-hand bike is as much of a responsibility as buying a new one. Since you have invested your savings, it is important to protect it and yourself from any financial burdens. Having a Comprehensive Cover not only proves you are a law-abiding citizen but also allows you to ride your bike without any worries. Investing in Add-on covers is another good way to stay prepared for troubled times.