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Top Factors to Consider While Buying Two-wheeler Insurance

By Juhi Walia
16 August 2022, 3:34 PM

In India, the law mandates that you follow up the purchase of your motorbike with at least a third-party two-wheeler insurance policy since the Motor Vehicles Act 1988 came into existence. Besides, a recent Supreme Court ruling necessitates you to have a 5-year insurance cover as the increase in the number of motorcycle riders increases accidents. To safeguard your finances against immense expenditure, you must choose various bike insurance types. With so much information flying around and your bike dealer pushing specific policies on you, it can be challenging to decide. Therefore, we help you narrow down the essential factors to consider while choosing the best insurance policy.

Type of Insurance Policy and Coverage

As mentioned in the introduction, Indian law requires all two-wheelers to have at least 3rd party bike insurance to protect you only in the case of damages or injuries caused to a third party due to your bike.

The second primary type of policy is the comprehensive bike insurance policy, which covers third-party liability in the case of an accident as well as damage to your own bike. Comprehensive policies provide enhanced protection as they cover both, third-party liabilities as well as own damages. Thus it would be helpful if you consider buying a comprehensive policy as it offers more coverage, and you can save a massive amount in case of an accident.

Your Premium Amount

The premium is the amount you pay to avail of the benefits under your bike insurance coverage. This amount will depend on several factors:

  • Insured Declared Value (IDV) — the current market value of your bike
  • Policy term — the duration of the policy
  • Type of coverage
  • Chosen add-ons
  • City or place you live
  • Make. model and variant of your bike

The premium ranges from INR 150 to INR 6,000, depending on the bike’s make and model and how much you can pay.

Cashless Transactions — Partner Garages

While researching two-wheeler insurance companies, it is a good idea to look into the list of their partner garages. This is helpful because if your company has an extensive network of partner garages, you can quickly get your vehicle fixed if it gets damaged in an accident. Because of this tie-up, your insurance policy will allow you to raise a cashless claim for your two-wheeler. You just need to send the vehicle to two-wheeler insurance cashless garage. This ensures that the insurance company will directly pay the garage, and you won’t have to pay a single penny for all that comes under your policy.


The best thing about comprehensive insurance policies is that they are customisable. You can choose some additional services that would apply suitably to you. These add-ons come at an extra cost but offer excellent service and assistance in times of emergency. Here’s a list of the most popular bike insurance add-ons.

1) No Claim Bonus – This is a handy add-on that most people are unaware of, but it could save you a good deal of money. No-claim Bonus or NCB is a discount provided by the insurance company to the policyholder as a reward for not filing for a claim in a policy year. It can be up to a 50% discount on your next premium.

2) Pillion Rider Cover – The person riding behind you on a bike is known as the pillion rider. Many people do not have insurance of their own. You should go for pillion rider bike insurance add-on if you often ride with a pillion rider. If you meet with an accident while having another person behind you, this feature will cover any injuries caused to the pillion rider.

3) Zero Depreciation – Your vehicle will undergo the usual wear-and-tear with time, and this causes a decrease in the cost of its parts and the bike as a whole. In regular policies and in the case of a claim, the insurer will calculate this depreciation and subtract that amount while paying out. Zero depreciation bike insurance add-on will ensure that you receive the original and higher payout from the company.

Reputation of the Insurance Company

Make sure you buy your two-wheeler insurance policy from a reputed company known for good customer service. Since claiming insurance during an emergency is a serious matter, it is crucial that your insurance company has a fast turnaround time, quick services, a transparent system and is easily contactable. With the internet, it has become effortless to learn about other people’s experiences, so make it a point to read through personal reviews by customers.

In addition, you can quickly look up a company’s Claim Settlement Ratio (CSR) — the ratio of a company's claims settled to the total number of claims incurred during a financial year. For example, if a company’s CSR is 95%, this means that for every 100 claims the company receives, it successfully settles 95 of them. This shows that the process of claiming insurance from that company is hassle-free. Investigating a company’s CSR is an excellent way to predict its reliability.


While buying two-wheeler insurance is mandatory, it would help first to do some research and keep a few crucial factors in mind while buying one. Compare bike insurance policies by different companies and consider the coverage, add-ons, premium amount, partner garages, CSR and the bike insurance company’s reputation before you decide to go for a plan.

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1. Is it necessary to buy insurance for your two-wheeler?

The law mandates having an insurance policy for any vehicle in India. You can be jailed or made to pay a hefty fine if caught without one. Additionally, you will only receive a registration number, and therefore a number plate, when you submit a copy of your insurance policy with other documents.

2. What is the cheapest insurance policy you can buy?

The law requires you to purchase a 3rd-party bike insurance policy at the very least, and it needs to last for 5 years if you are a first-time buyer. This is the most basic policy and will involve the cheapest premiums. It only covers damages caused to third-party due to your bike. It also saves you from legal repercussions. 

3. Can insurance ownership be transferred, like selling your bike or buying a used bike?

Yes, transferring insurance policies to somebody else’s name is pretty easy and convenient. The new buyer of the motorcycle should fill out an application and send it to the insurer within 14 days of the physical transfer of the bike. This begins the process of transfer of insurance.

4. Can I buy two-wheeler insurance online?

Yes, with online platforms like Paytm Insurance, it is extremely easy and quick to buy a two-wheeler insurance policy online.  

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