A Complete Guide of Two-wheeler Insurance Policy
Updated On Oct 31, 2020
Types of bike insurance plans, what are add-ons under bike insurance plans, important terms related to bike insurance. Here is a complete guide of two-wheeler insurance policy.
In India the traffic rules are governed by the Indian Motor Tariff. The traffic rules under this act has to be followed by every two-wheeler that is on Indian roads. One specific rule under this act explains the requirement of a valid third party insurance cover of all the two-wheelers be it private or commercial.
It clearly indicates that an individual who is the owner of any two-wheeler has to get their two-wheeler insured with at least a third party two-wheeler insurance plan. Besides the basic third party policy, there are two more types of insurance plans available for two-wheelers.
Types of Bike Insurance Plans
Following are the three types of insurance plans available for bikes:
1. Third Party Bike Insurance Policy
Specified under the Indian Motor Tariff third party liability insurance policy is mandatory cover. Any damage or injury caused to other individuals due to the bike is covered under third party liability insurance. This cover provides for bodily injuries as well as death of a third party. The compensation for third party property damage is limited up to Rs. 1 lakh.
2. Standalone Own-Damage Bike Insurance Policy
This policy provides an insurance cover for own-damages incurred by the bike in road accidents, natural calamities, man-made disasters, fire, theft, riot, strike and any other misfortunate events.
3. Comprehensive Bike Insurance Policy
It is a bundled cover which provides for third party liabilities as well as own-damages incurred by the insured’s bike. This plan offers the maximum coverage.
What Are Add-Ons Under Bike Insurance Plans?
Add-ons refers to additional coverages which can be opted with standalone own-damage and comprehensive plans to strengthen coverage provided by basic plans. Some of the popular two-wheeler insurance add-ons are:
1. Zero Depreciation Add-On
Under this add-on, the depreciated parts of the bike are not considered at the time of claim. The insurance company pays the total cost of repairs out of their pocket irrespective of the depreciation suffered.
2. Roadside Assistance Add-On
Roadside assistance add-on offers assistance to the policyholder in case of breakdowns. Policyholders just have to intimate the insurance provider and the insurance company sends help wherever they are. Assistance is offered for flat tyres, electrical breakdowns, jump-starting the bike, etc.
3. NCB Protect Add-On
In a bike insurance policy, if a policyholder does not make a claim in a policy year, they are entitled to no claim bonus. This allows them a discount on the renewal of the premium. On the other, when a claim occurs, the entire no claim bonus is consumed. NCB protect add-on protects this loss of no claim bonus. It keeps the NCB intact even after the policyholder makes a claim.
4. Lost Key Replacement
If the policyholder loses the key of the bike, Lost key replacement would cover the cost of replacing it with a new key.
5. Medical Expenses Add-On
Medical expenses add-on covers the medical expense which the policyholder may face if they are hospitalised following a bike accident.
6. Consumables Cover
Consumables cover include engine oil, nuts, bolts, etc. that are used by the garage in repairing the bike. In case of repairs, costs incurred on such consumables are not covered under the bike insurance policy. Consumables cover makes sure that the cost consumables is also covered.
Important Terms Related To Bike Insurance
1. Own Damage Cover
Any harm suffered by the bike itself is known as own damage. This cover is included under comprehensive policies.
2. Compulsory Deductible
Under Compulsory Deductible, the policyholder has to compulsorily pay a part of the bike insurance claim.
3. Voluntary Deductible
A voluntary deductible is an amount that a policyholder can opt to voluntarily pay at the time of a claim settlement in return for a discount in the premium.
4. Insured Declared Value (IDV)
Insured Declared Value is a maximum coverage provided in a comprehensive policy. The value is arrived at by deducting the market value of the bike with depreciation based on the age of the bike.
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Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.