Bike insurance or two-wheeler insurance is an insurance policy which can include both third-party insurance along with own-damage insurance. While third-party damage indemnifies you from any legal claims resulting out of an accident involving your bike, own damage insurance provides cover to your bike because of any accident or damage. The Motor Vehicle Act in India makes it a statutory requirement for all motor vehicle insurance policies to have a third-party cover.
You must always remember to have a valid insurance for bike as not having insurance is a traffic offence. As per the Motor Vehicle [Amendment] Bill, 2019, not having valid insurance for bike is punishable by a fine of Rs 2,000 and/or imprisonment up to three months for the first offence and an enhanced fine of Rs 4,000 for the second offence.
In 2018, the Insurance Regulatory and Development Authority of India [IRDAI] announced changes in insurance rules for bikes. For new bikes purchased after September 1, 2018, the IRDAI made it mandatory to avail five-year insurance for third-party. This meant that the premium for third-party, for a total of five years, had to be paid upfront while purchasing a new bike. Owners of two-wheelers purchased before the specified date could continue with their existing insurance policies.
Here, you must remember that the IRDAI made changes about third-party rules. Own-damage premium could be availed both on a multi-year or annual basis. The change in rules did affect rules about the no-claim bonus or the Insured Declared Value [IDV] of a bike.
Types of bike insurance plans
You can avail of two types of bike insurance plans
- Third-party liability cover – This policy provides financial cover only to the third-party against damages by your bike.
- Comprehensive cover – This policy covers any damages suffered by your bike and you along with the mandatory third-party cover. Other benefits include a cover for damages arising out of man-made and natural calamities and against vehicle theft.
Existing options for bike owners with regards to insurance policies: If you are a bike owner, you have the option of multi-year comprehensive two wheeler insurance policy, where the premiums for both third-party and own damage have to paid for multiple years, or a bundled policy, where you are required to pay own damage premium on an annual basis. You can opt for an annual policy or a multi-year policy on the basis of your specific requirements. But a multi-year insurance for bike is always advantageous vis-a-vis annual policies.
Benefits of multi-year insurance policies: Along with reduced costs on the bike insurance price through discounts by insurers, there are many benefits of multi-year bike insurance policies. Some of these include:
Hassle-free – You don’t have to worry about how to renew bike insurance online. At Finserv MARKETS, policy renewal is an easy and straight forward process. Forget the worry of getting your bike renewed each year amidst a host of personal priorities like filing of income tax returns, vehicle servicing, annual health check-up etc. If you forget to renew the bike insurance on the specified date, then you run the risk of riding with an invalid insurance. This is a punishable offence.
Saves from increase in premium – IRDAI and insurers revise the bike insurance policies on a regular basis, usually annually. Purchasing a multi-year policy protects you for the increase in bike insurance price due to revisions. So you can save money on the bike insurance price through reduced premium payments.
No Claim Bonus benefits – Insurance companies provide you with No Claim Bonus[NCB] for not making any claims for own damage during a year. In the case of annual policies, the NCB will fall to zero in case of no claims, and won’t be carried forward. But, in the case of multi-year policies, the NCB will be carried forward to the next year. The bonus can start from 20% at the end of the first year to a maximum of 50% for five consecutive years.
Easy cancellation – Even if you want to change your existing insurer after completion of the first year, you can easily buy bike insurance from another company and apply for cancelling the present multi-year insurance policy. You can receive a refund after your application is processed. What’s more, the NCB can be transferred as well through an NCB retention certificate.
Which multi-year bike insurance policy is the best?
You can consider Bajaj Allianz Two Wheeler Insurance policy, available on Finserv MARKETS, which provides you with attractive discounts on the bike insurance price. You can avail of hassle-free renewals with no requirement of bike inspection. Along with cashless settlement of claims at more than 4,000 network garages, you can avail of 24*7 roadside assistance. You can apply for getting a new insurance policy, or for renewal through a simple online process. You can also register your claims online, resulting in quicker settlement of claims.