How bike insurance works in India?

Having a two-wheeler to navigate in the roads of India is no less of a bliss. Adding to the advantages of owning a two-wheeler is that it is convenient and also easy to maintain. The two-wheeler industry in India has the largest number of sales and production in the world. This gives a clear sign on how useful a two-wheeler is for the roads of India. But now the question arises on how safe is a two-wheeler in the roads of India? With increasing number of accidents daily the answer is obviously not positive. This is when a two-wheeler insurance comes at rescue.

What is bike insurance?

A two-wheeler insurance is a part of the general insurance policy and is an agreement between the insurer and the owner of the two-wheeler wherein the insurer covers any sort of damages that are incurred due to an accident, theft or natural disaster. Thankfully, owning a two-wheeler insurance is mandatory by law, at least owning a third-party cover is compulsory. A two-wheeler insurance acts as a shield for the financial losses that are incurred while coming across an unforeseen event. It also provides protection against the financial losses that are incurred due to injuries to the rider, pillion as well as to the third party.

How does bike insurance work in India?

There are various factors to be kept in mind before buying a two-wheeler insurance in India. There are basically three types of two-wheeler insurance found here.

  1. Third-party liability Insurance policy

This policy is mandatory as per Indian law as this cover against the loss, property damage, bodily injury or death to a third party caused by the insured two-wheeler.

  1. Comprehensive Insurance policy

Comprehensive Insurance policy is also known as Package policy. This policy is not mandatory by law but it covers everything included in a liability only policy along with coverage for theft or damage of the two-wheeler.

  1. Own damage policy

This policy covers against damages/ losses caused due to natural calamities, accident by external means, theft, damage during travel by water, air, rail, road to the two-wheeler.

The two-wheeler insurance premium is also affected due to various factors.

  1. Coverage

The premium is decided as per the coverage chosen. If it is a third-liability insurance coverage then the premium amount will be low whereas the premium amount for comprehensive coverage will be high as offers complete protection.

  1. IDV

IDV is insured declared value. It is the market value of the vehicle. The premium is set as per the vehicle’s IDV.

  1. Cubic Capacity

Cubic capacity is the vehicle’s engine capacity. The higher the CC, higher will be the premium.

  1. Age

The age of the vehicle decides the premium rate as old vehicles are tend to more damages than new the premium will be high for the old ones.

  1. Location

The insurance premium for the vehicles at metro cities will be high as compared to the other cities as they are prone more danger.

  1. NCB

NCB is No Claim Bonus. This is a discount given to the two-wheeler’s future premium if the policy holder has not made any claims during the policy period.