For those who are not familiar with the law governing bike insurance—purchasing at least a Third-party Liability Two-wheeler Insurance Policy is compulsory in India. This rule is in accordance with The Motor Vehicles Act. If you fail to comply with this law, you will have to face monetary penalties. You can also end up in jail for non-compliance! Worse, an accident caused by an uninsured bike can have severe legal consequences. But why is bike insurance mandatory in India? Read ahead to know the answer and other aspects related to the mandatory nature of vehicle insurance in India.
- Why is Bike Insurance Mandatory in India?
- How Does Bike Insurance Protect You?
- What Does A Two-wheeler Insurance Policy Cover?
- 1) Third-party Liability Cover
- 2) Comprehensive Cover
- 3) Comprehensive Plan and Add-ons
- Buy Two-wheeler Insurance Policy Online:
- Tips to Keep in Mind While Purchasing Two-wheeler Insurance:
- Frequently Asked Questions:
Why is Bike Insurance Mandatory in India?
The brief answer to the question ‘why is bike insurance mandatory in India’ is that accidents are unpredictable. This unpredictability makes it important to buy insurance for yourself as well as for those who might be affected by your vehicle. Therefore, there are two major types of bike insurance policies available in the Indian market: Third-party Liability and Comprehensive Bike Insurance.
Of these, the Liability Plan is mandatory. The Comprehensive plan offers wide-ranging coverage and includes the mandatory cover. Therefore, no matter which plan you pick, you shall have the mandatory cover.
How Does Bike Insurance Protect You?
A bike insurance policy protects you in two major ways: Protection against legal Liabilities and Protection against financial expenditure arising out of bike-related mishaps.
1) Legal Liabilities
If your bike goes out of control and injures a pedestrian or damages someone’s property, you are legally liable to pay for the damage. A Third-party Liability policy protects you against such liabilities, where the insurance company will manage the legal liabilities on your behalf as per the terms and conditions.
2) Financial Expenditure
If your bike gets damaged in a flash flood or is affected by fire caused during riots, a Comprehensive Bike Insurance Plan will help you to get the bike repaired without spending a huge sum of money from your pocket. The insurance company will handle the repair work as per the terms and conditions of the policy.
What Does A Two-wheeler Insurance Policy Cover?
The extent of the two-wheeler insurance policy’s coverage depends upon the type of cover. A basic Third-party Liability plan offers minimal coverage, a Comprehensive Plan offers wide-ranging coverage, and a Comprehensive Plan along with suitable Add-ons offers extensive coverage. The premium for the same increases respectively. Here’s a snapshot of the coverage offered by different types of policies.
1) Third-party Liability Cover
A liability-only policy offers the following coverage to the policyholder.
1) Legal Cover:
Legal issues arising out of injury to a 3rd person or damage to 3rd person’s property are handled by the insurer as per the terms and conditions. They offer monetary compensation to the third party.
2) Personal Accident Cover:
The bike owner might face permanent disability or death due to a bike accident. In such instances, the policy offers a Personal Accident Cover as per the terms and conditions.
2) Comprehensive Cover
A Comprehensive Plan offers the following coverage to the policyholder. It also covers the points mentioned in the Third-party Liability Cover section.
1) Loss Due to Natural Calamity
Several areas in India have become prone to damages due to natural calamities such as flash floods, cyclones, fire, etc. If your bike gets damaged because of such issues, the repair cost shall be managed by the insurer.
2) Loss Due to Man-made Calamity
Apart from natural calamities, there are man-made calamities as well. A big-scale riot can cause a lot of damage to the city’s infrastructure. If your bike gets damaged in such riots, you can raise a claim with your insurer for appropriate compensation.
3) Loss Due to Theft
Bike theft is a possibility not just in rural areas but in semi-urban and urban areas as well. A Comprehensive plan covers the policyholder against bike theft. In case of such an unfortunate event, the policyholder is compensated with the bike’s Insured Declared Value.
3) Comprehensive Plan and Add-ons
You also have the option of purchasing a Comprehensive plan and enhancing the coverage by buying suitable Add-ons. You will have to pay a bit extra to buy the Add-on—you can buy multiple Add-ons and pay for each accordingly. These Add-ons offer great service and assistance in times of need. Here’s a list of some of the popular bike insurance Add-ons.
1) Zero Depreciation
With this Add-on, the insurer will skip the depreciation calculation while settling claims. As a result, you will receive a higher claims pay-out.
2) Pillion Rider Cover
This can be viewed as accident coverage for the pillion rider. This kind of Add-on is ideal if someone regularly travels as a pillion rider with you.
3) Invoice Protection
In case of a total loss, the insurer will reimburse you with the bike’s invoice value if you opt for this Add-on. Otherwise, the insurer considers the Insured Declared Value while settling total loss claims. Insured Declared Value is always less than the Invoice Value.
4) No Claim Bonus Protection
With this Add-on by your side, you can raise a claim and still be eligible for the renewal discount known as No Claim Bonus (NCB). It protects your No Claim Bonus component, hence the name—NCB Protection.
Also, read: IRDAI Rules For Two Wheeler Insurance Policies
Buy Two-wheeler Insurance Policy Online:
The Internet and smartphones have changed the world. Nowadays, almost everything can be purchased with just a few clicks. Bike insurance is no different. You can insure your bike under five minutes, from start to finish, on insurance company’s websites. Online two-wheeler insurance is easy to understand, quick to buy, and convenient to claim.
Tips to Keep in Mind While Purchasing Two-wheeler Insurance:
Here are some handy pointers to help you buy bike insurance online.
- Understand your insurance requirements before setting out to buy a policy.
- Check the cover, premium, and features of the policy in detail.
- Have a look at the terms and conditions of the plan.
- Digital-first insurers are known to offer enhanced coverage at incredibly low prices.
- Go for a Comprehensive plan for a wide-ranging cover.
- Select only those Add-ons that will add value to your policy.
Frequently Asked Questions:
Here’s a list of common queries concerning bike insurance in India.
Bike insurance is mandatory across India, including rural areas.
Bike insurance is a legal requirement. All bikes, whether in use or not, must be insured for your benefit.
In this case, you can contact the insurance agent or the company from whom you have purchased the policy and request for a copy of the policy.
Get the error rectified with the insurance company via Policy Endorsement at the earliest.
Yes, bike insurance policies purchased online are valid policies, provided you buy them from a certified insurer. You can look for the insurer’s IRDAI registration number to confirm their authenticity. The number should be available on the insurer’s website.
- List of Add-on Covers In Bike Insurance
- What is No Claim Bonus (NCB) in Bike Insurance
- A Complete Guide to Changing Your Two-Wheeler Insurance Policy Online
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