For many people In India, a two-wheeler is an important mode of transport. But before taking a two-wheeler on the road, you should get a two-wheeler insurance in order to get financial protection for situations like accidents involving your vehicle.
What is Two-Wheeler Insurance?
Many people avoid availing a two-wheeler insurance, and as a result, they end up paying large sums of money in accidents. On July 20 2018, the Government of India declared that a third-party insurance is mandatory for all two-wheeler and four-wheeler. The mandatory third-party insurance financially protects you and your vehicle in case of accidents. The insurance scheme usually covers accidents that cause damage to your vehicle, injury to the rider, and anybody who gets hurt by the vehicle.
Types of Two-Wheeler Insurance
- There are two types of two-wheeler insurance on the basis of the coverage of the policy. They are:
Third-Party Insurance: This type of insurance is also termed as limited liability insurance. This plan covers bodily injuries or damage caused to the third party due to an accident. The plan also covers the death/disability of the third party that may have been caused due to that accident.
Comprehensive Insurance: This type of insurance is also termed as package policy. It covers third-party liability as well as damage caused to the insured vehicle, and death/disability of the owner/driver due to the accident.
2. There are two types of two-wheeler insurance on the basis of the term of the policy. They are:
Short-Term Insurance Plan: The motorbike insurance with tenure of 1 year is known as a short-term insurance plan. The premium of short-term insurance increases by 10% to 15% each year. Generally, self-damage benefits are not provided in short-term insurance. You can avail a No Claim Bonus (NCB), if you wish to renew your policy.
Long-Term Insurance Plan: A two-wheeler insurance plan can have a maximum tenure of 3 years. Hence, insurance schemes that have tenure of more than 1 year are termed as long-term insurance plans. Long-term insurance covers self damage caused due to the insured vehicle. The company provides a decrease in the premiums when you invest for a longer period along with a higher percentage of NCB (20%).
Long-term insurance plans are much more affordable and cost-efficient than short-term insurance plans. Although, the short-term plans are more flexible and offer many add-on facilities than long-term policies do.
What all Two-Wheeler Insurance Covers?
Let us understand the kind of coverage provided by a two-wheeler insurance. In other words, you can make claims for these cases. However, these are some common points which can vary for different providers.
- Damage caused to the vehicle, the owner and the driver due to accidents
- Personal accident coverage for owner and driver
- Damage occurred due to natural disasters
- Damage induced due to man-made disasters
- Third-party liabilities
- Loss or theft of the two-wheeler
It is mandatory for all two-wheeler to get an ar insurance, along with a third-party insurance coverage. In order to get the two-wheeler insurance, a person must be 18 years and above, a citizen of India, should possess a driving license and should possess the RC of the two-vehicle.
Two-Wheeler Insurance Claim Process
- In case of any untoward incident like accident or theft, immediately inform the insurance provider.
- If the two-wheeler was involved in an accident or was stolen, file an FIR and produce its copy to the company
- Then, you can then apply for registration of the claim by producing related documents like claim form, a copy of the registration of the vehicle (RC) and others
- One can also get a cashless claim if one gets the vehicle repaired in a garage covered under the network of the insurance provider. The repairs and replacements done in network garages are cashless as provided by the insurance companies
- Payment will be done after an evaluation of your damage and cost of the repair
- In case the policyholder takes his vehicle to the garage not covered under the network, he would have to pay for the claim which can later be reimbursed from the insurance company
Documents Required For Claim Process
In case of an accident or damage done to you, your car or to the third party, intimation to the insurance company is important. Along with that, following are the essential documents to be submitted for timely claim:
- Duly filled in claim form
- Copy of the insurance policy
- Copy of the driving license of the person driving the vehicle at the time of accident
- FIR, in case of third party damage, death, bodily injury
- All the sets of keys, service booklets and warrant card in case of theft
- Repair bills and payment after the repair is done
How Long Does it Take to Pay Out the Claim?
Motor Insurance provider companies have two options to settle the claim – one is cashless where the company pays for the repairs done at one of the network garages; the other is reimbursement where the claim is settled if the insured repairs his vehicle in the garage which does not come under the network of the insurance company. An insurance company can take somewhere around 10-30 days for claim settlement.
While regular motorcycle insurance gives basic protection, you can enhance your protection by buying add-on covers along with the standard coverage. All vehicle insurance comes with add-on covers in addition to the standard benefits offered by the insurance. Following are the add-on covers that you must buy along with your two-wheeler insurance:
Personal Accident Cover: By buying this cover, you get insured against death or permanent disability due to the accident. This add-on cover is not altered by the person who drove the vehicle when the accident took place.
Nil Depreciation Cover: This is the most important add-on cover that you must buy while finalising your bike insurance. With this add-on cover, your vehicle gets the original value in case it is lost or damaged.
Cases Where You Can’t Claim Two-Wheeler Insurance (Exclusions)
Below are some factors that can lead to rejection of a two-wheeler insurance claim. These are also called exclusions.
- Regular wear and tear
- Driving under the influence of drugs or alcohol
- Driving without license
- Underage driving
- Using commercial vehicles for private purpose or vice versa
- Staged crash
- Expired policy
- Electrical/mechanical breakdown
- Crossing geographical limits
- Damage or loss due to war
- Consequential damage
Companies Offering Two-Wheeler Insurance In India
Some of the insurance companies providing two-wheeler insurance in India are as follows:
- Bajaj Allianz
- Universal Sompo
- ICICI Lombard
- TATA AIG
- National Insurance
- IFFCO Tokio
- Bharti AXA
Applying For Two-Wheeler Insurance
A person who has got the legal permission to drive a two-wheeler in India can apply for a two-wheeler insurance, provided the individual have a valid driving license. One can apply for vehicle insurance in India via online or offline mode and below are the ways to do it:
- Compare the benefits offered by many insurance providers in India
- Visit the official website of the chosen Insurance company and check the claim ratio
- If you are choosing insurance web-aggregator, you will get variable quotes from different insurance providers
- Use the online two-wheeler insurance calculator to compare the premiums from different insurance companies
- After providing few personal details, you can click on the online apply-button, and process of your application is complete
- To buy an insurance policy offline, you need to find an insurance agent or the insurance company you wish to invest in
- Fill up the relevant forms given to on the basis of your requirements
- If you directly approach the insurance company, you can avoid the additional fee charged by the agents. Some banks and third-party dealers can also help you in completing the application process
- After submitting a few necessary documents (if any) according to the company norms, your application will be completed
- Always make sure to compare the bike insurance plans online so that you can avail the best insurance plan suited for your needs
- Every vehicle insurance company makes a certain amount mandatory for you to pay for the expenses caused due to mishaps. This mandatory amount is known as compulsory deductible (~500 rupees). If you choose to pay some more money as a voluntary deductible, there will be a decrease in the premium you pay for your motorbike insurance
- Always follow all the safety measures while driving and opt for discounts from accumulated no claim bonus (NCB) on your next renewal
- Get anti-theft devices fit in your two-wheeler as it will further lower premium
- Old two-wheelers get low IDV (Insured Declared Value) due to the loss of value over time. So, the premiums for older vehicles are lesser than the new ones
- You can also get a concession in the premiums if you are a member of the IRDA registered Automobile Association of India (AAI)
- Also understand that your premium depends on various factors like type of vehicle, your lifestyle and your past driving history
Advantages of Buying Two-Wheeler Insurance
With the emergence of new insurance providers every year in the market, the facilities and benefits of two-wheeler insurance are evolving with time. Following are some of the benefits of buying bike insurance:
- One can get a personal accident cover of up to Rs 1 lakh
- Bike Insurance protects you from the legal liability of any damages caused by your vehicle to a third-party
- By buying a two-wheeler insurance, you can get protection from unforeseen natural calamities like storms, earthquakes, etc.
- Add-ons like depreciation of the vehicle further increase the benefits of buying a two wheeler insurance
- Motorcycle insurance can be easily bought or renewed online without much hassle
- If you have not claimed for insurance before and buying a new vehicle, the insurance provider provides easy transfer of No Claim Bonus (NCB)
- One can get a cashless garage service if you have bought two-wheeler insurance
- You can keep track of your bike insurance policy online by logging on to the website of your insurance provider
Q1. What are the mistakes to avoid while choosing a vehicle insurance?
Following are few errors that you must avoid when buying a two-wheeler insurance:
- Avoiding the terms and conditions
- Considering the lowest premiums and avoiding the coverage of the policy
- Inappropriate add-on selection
- Choosing the offline mode for the application
- Not renewing the policy punctually
- Not asking for no claim bonus
- Choosing smaller deductive
Q2. How buying Nil Depreciation Cover will benefit me?
If you do not opt for nil depreciation cover, you will be charged some amount as depreciation at the time of receiving your claims. This feature is an add-on cover and experts’ advice always to consider buying this add-on cover to get the original value of your two-wheeler at any point in time.