Two Wheeler Insurance

 

 Two wheeler insurance (Bike Insurance), as the name suggests is an Motor insurance policy for covering your two wheeler against Accidents, Accidental Damage, Theft, Natural Calamities, Third Party Loss of Life/Property etc. The insured can opt for the coverage they require against which a premium is remitted to the insurer. The two wheeler insurance policy offers the policy holder a financial coverage in case any of the earlier stated perils were to occur. Without a valid two wheeler insurance policy in place, any individual have to bear the financial burden arising from their pockets which can be a strain on them.

 

Two Wheeler Insurance In India Is Of Two Types:

Third Party Liability Cover:

This two wheeler insurance plan provides coverage for all the damages caused to the third party (bodily injury or property damage), as well as suffered by the insured to the two wheeler due to a covered peril. The damages caused may be due to human acts (while driving) or a natural calamity. It covers the damages to the insured’s vehicle, third-party legal liability, theft and personal accident coverage

Comprehensive Two Wheeler Insurance Plan:

This two wheeler insurance plan provides coverage for all the damages caused to the third party (bodily injury or property damage), as well as suffered by the insured to the two wheeler due to a covered peril. The damages caused may be due to human acts (while driving) or a natural calamity. It covers the damages to the insured’s vehicle, third-party legal liability, theft and personal accident coverage

What Is The Two Wheeler Insurance Cover About?

Here are some of the features of a two wheeler insurance policy:

  • Two Wheeler Insurance(Bike Insurance), is an insurance policy for covering your two wheeler against Accidents, Accidental Damage, Theft, Natural Calamities, Third Party Loss of Life/Property or Bodily Injury etc and covering any liability arising out of these state perils.
  • Two wheeler insurance like a motor insurance plan, is a mandatory cover required by the law. Every two wheeler owner must legally have atleast a Third Party policy covering their vehicle. Vehicles plying without a valid insurance policy are liable to attract fines from the authorities.
  • The vehicle owner will need to arrive at a defined IDV (Sum insured) with the insurance company, finalise if they want a TP or Comprehensive coverage and pay the applicable premium to ensure coverage.
  • Coverage is typically for Damages to Property/Life of a Third Party, Personal Accident Coverage for the Driver, Theft, Loss of Vehicle, Fire Damages, Natural Calamities. If a person chooses only a TP coverage, then the policy will be applicable only in the case of a Third Party damage to Property or Bodily Injury to the Third Party.
  • Hence having a Two Wheeler policy in place means Peach of Mind for the vehicle Owner, Financial Protection in case any of the perils occur, Legally above board since the mandatory cover is in place and Coverage in case of Personal Accident.
  • Today most insurance companies offer very aggressive pricing with discounts on Own Damage (OD) portion of the premium going upto to between 60% and 70% depending on the vehicle model and driver’s riding track record. Insurers have also started offering Long Term Insurance policies between 2-3 years.
 
What Are The Factors That Impact The Two Wheeler Insurance Premium?

The factors that influence the premiums include:

  • Vehicle type: The type of your two-wheeler – manufacturer, model, class, cubic capacity, and fuel type will determine your premium. If your motorcycle has a higher cubic capacity or a larger displacement engine, you will have to pay a higher premium. If you have a motorsport bike, your premium will be relatively higher.
  • Type of coverage: This depends on whether you would like to buy a Third-party cover which is the most basic cover, or a Comprehensive Cover. The premiums for a Comprehensive coverage will be significantly higher than a TP cover, but the coverage is also much more wider.
  • No Claim Bonus : The NCB enjoyed by the owner will also impact he premium. More claim free years of driving means higher NCB Bonus and hence lower premiums.
  • Geographical area: The area you reside in will determine your two-wheeler premium. If you are staying in a rural area, your premiums will be comparatively lesser.
Exclusions Under The Two Wheeler Insurance Policy:

The exclusions in a Two Wheeler policy include:

  • Driving without a valid license: The two wheeler insurance policy requires that the rider at the time of the accident have a valid driving license. Claims will be repudiated if the two wheeler was being ridden by an individual without a valid driving license.
  • Driving under influence of alcohol: Driving under the influence of narcotics, drugs or alcohol and meeting with an accident due to inebriation is not covered under the policy. Hence no claim due to damage to the vehicle due to an accident while riding under the influence will be payable.
  • Burglary: In case there are damages to, or a loss of accessories, due to burglary, robbery or housebreaking, the two wheeler insurance policy will not cover the costs of repairs or replacements unless the whole vehicle is stolen at the same time.
  • Wear and tear: Two wheeler insurance does not offer cover damages due to wear and tear, general ageing, electrical or mechanical failure and breakdown.
  • Other exclusions: Two wheeler insurance also excludes claims arising out of any contractual liability, damage to tubes and tyres unless they are damaged during an accident, using the two wheeler for reasons that are not legal, damage caused to the two wheeler when it is being used outside the geographical boundaries of India, and damages attributable to mutiny, nuclear risks, war, etc.
 

Add-on covers in two wheeler insurance (like car insurance) provide extra protection to the policyholder, over and above the coverage offered by a comprehensive two wheeler insurance policy. Some of the popular add-on covers in two wheeler insurance being offered by the insurers today are Zero depreciation cover, Personal Accident cover for the pillion rider, and 24×7 Roadside Assistance.

Personal Accident Cover for Pillion Rider
This cover provides personal accident coverage for pillion riders in the event of the pillion rider’s partial or permanent disability or death while riding the insured vehicle. The amount that can be claimed would depend on the type and the extent of injury suffered by the pillion rider at the time. It is a cover that should be taken if the insured travels with a pillion rider regularly.

Roadside Assistance
This cover would entitle the insured to 24X7 roadside assistance in the event of a breakdown or a mechanical failure of the insured two wheeler. Among the services offered are Emergency Assistance, Towing facility in the event of a breakdown, Minor Repairs at the site of the accident/breakdown, Accommodation benefit due to the vehicle being unfit to ride, etc.

Zero Depreciation Cover
This is also known as Depreciation Reimbursement or Bumper to Bumper cover. The Insurer will pay you the amount of depreciation on account of wear and tear which is deducted on the value of parts replaced under own damage claim, lodged under the own damage section of the policy. They will pay for the first 2 claims reported to them during the Period of insurance.

Accessories Cover:
This add on would provide coverage to any electrical or non-electrical accessories added to the two wheeler, resulting in the insurance company covering the cost of replacing/repairing them.

Long Term Two Wheeler Insurance:

Most Insurance companies now offer long term two wheeler insurance plans that have tenure of 2-3 years. This is ideal for both the vehicle owner and the insurer since they need not worry about renewal of insurance for up to 3 years. The advantages of the Long Term Policy include:

  • Saves TP Premium over 2-3 years – with almost an annual increase on TP premium, by buying a Long Term policy and paying premium upfront for 2-3 years, this TP premium increase will not be applicable
  • Avoid Yearly Renewal – the owner need not have to track the renewal dates every year of the two wheeler in a long term policy.
  • NCB Protection for the entire period – if the insured has eligibility for a 25% NCB, the same will be applicable on the premium for the entire duration of the cover (2-3 years). Even if there is a claim on one of the policy years, the applicable NCB will fall to the lower slab, but not become NIL.
  • Long Term Coverage – A single insurance policy is issued for the entire period of 2-3 years and hence the owner can ride around stress free knowing that the coverage is in place for the duration of the policy.
  • Higher OD Discounts – given that the insured is committing to a longer period of insurance and the same is being paid upfront, the insurers are offering attractive discounts upfront to ensure competitive premiums for the long term cover.

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