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Why Should You Opt for a Multi-year Two-wheeler Insurance Policy?

By Juhi Walia
26 July 2022, 9:30 AM

A multi-year bike insurance policy provides coverage for more than a year (usually up to 3-5 years). The IRDAI introduced the multi-year insurance cover a few years back to motivate motorists to renew their insurance policies after 3-5 years and to reduce the lapsed policy ratio. Policyholders need not worry about the renewal date every year and can also avoid any financial losses. The one-time premium of multi-year policies for say five years can be huge in number. But on a cumulative basis, it will be lower than the one for a short-term policy. Read on to understand why such plans are better than a one-year plan and why you should invest in them.

1. Avoid the Unnecessary Hassle of Annual Renewal

With the introduction of a multi-year bike insurance policy, the challenging process of policy renewal has become a problem of the past. The time-consuming renewal process, which involves a lot of paperwork, can be eliminated by purchasing the multi-year insurance cover.

You can insure your bike for 2-5 years and avoid the tension of riding your motorcycle without a valid bike insurance policy.

2. Save More on Premiums

IRDAI revises the third-party bike insurance premium every year. The revision often leads to a higher annual premium for third-party bike insurance policyholders. So, even if the own damage component of your policy does not go up, the yearly hike in the third-party component of your comprehensive bike insurance policy will keep raising your overall premium liability every year.

Getting a multi-year insurance policy is the best way to lock the premium for a long period and avoid the annual hike. Furthermore, several insurance providers offer lucrative discounts when you purchase a multi-year policy.  

3. Enjoy No-claim Bonus

No-claim bonus (NCB) in bike insurance is an incentive the insurer provides if no claims are made in the previous year. If you don’t renew your policy even within 90 days of the annual renewal date, you might lose your NCB. Moreover, a short-term bike insurance policy will grant you lesser NCB than a long-term insurance cover.

Under a multi-year policy, you will be granted an NCB even if you make a bike insurance claim during the policy tenure. However, no bonus will be paid if more than two claims are made. The discount amount is calculated based on the number of claims made and is usually 20% for the first year and goes up to 50% for the fifth successive claim-free year. However, the rate structure over the years can vary.

4.No Risk of Policy Lapse

A lapsed bike insurance policy cannot be renewed. You will have to go through the entire inspection and IDV calculation process, which is time-consuming. Moreover, you may end up paying more as the insurer will likely raise your premium. You can avoid this risk by getting a multi-year policy and enjoying hassle-free benefits for 3-5 years.

5. Avoid Break-in Policies

Imagine a scenario where you want to buy a new bike insurance policy after a gap of two years in the bike insurance renewal. This is referred to as a “break-in” policy. Due to this gap, the insurer will inspect your bike. After the assessment, there are high chances of rejection if the insurer declares that the bike is not in an “insurable” condition. Even after approval, the premium will be higher, and the insured declared value (IDV) in bike insurance might go down. You can escape this situation with the help of a multi-year insurance policy.  

6. Easy Cancellation of Policy

The most interesting part of a multi-year insurance policy is that it can be cancelled anytime. It is not mandatory to keep the policy for the entire tenure. What’s more? You will receive the unutilised premium amount. Based on the terms and conditions of the policy, you may be granted a full or partial refund upon cancellation.

Such benefits are absent in most short-term insurance policies. To retain the NCB, purchasing a new policy before cancelling the existing one is important.

Read more - Everything You Should Know About Cancelling Your Bike Insurance

7. Avoid Fines and Losses

It is an offence to ride an uninsured bike in India. You can end up paying hefty fines if you get caught by the traffic police for riding a motorcycle without valid bike insurance. In the event of an accident, you will have to bear the expenses from your pocket if your policy has lapsed. Therefore, riding without insurance can land you in troubled waters. This could be the case with an annual policy. You can avoid such scenarios by buying a multi-year insurance policy.


After reading the above information, you must now be aware of the multiple advantages associated with a multi-year bike insurance cover. It is recommended to buy a multi-year policy for brand new bikes or for the ones you wish to keep for many years.

Read more -


1. Can I transfer my multi-year bike insurance policy to another insurer?

You can easily transfer your multi-year policy to another insurance provider if you find a better insurance deal with lower premiums and good coverage

2. You can easily transfer your multi-year policy to another insurance provider if you find a better insurance deal with lower premiums and good coverage

Some multi-year insurance covers allow you to make cashless claims at network garages. You no longer have to worry about arranging funds for repair work.

3. Is it possible to purchase a multi-year insurance cover online?

A multi-year insurance policy can be issued online, and you will receive a single policy document for three years. This process involves less paperwork.

4. Is personal accident cover for co-passengers included in a multi-year bike insurance policy?

 It is possible to avail a personal cover for co-passengers by paying an extra premium. This way, you can financially protect your co-passengers.  

5. What is covered by the own-damage insurance cover under a multi-year insurance cover?

Own-damage insurance cover covers vehicle damage, accidental damage, damage against theft, damages due to man-made and natural calamities etc. 

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