IDV means Insured Declared Value, it is the maximum sum insured amount which a vehicle insurance provider will offer you when you file a claim. Also, it has a direct impact on the cost of your bike insurance premium. This amount is fixed by the insurance company and is similar to the market value of the vehicle. However, it changes during policy renewal. In simple words, it is the current market value of your vehicle.
No Claim Bonus [NCB] is the sum accumulated every year. Your concession depends on the number of claim-free years you’ve earned. If you have a good driving record, you can earn a certain percentage of no-claim concession, considering your demographics as well as a profession and some other factors.
Let us now go in detail about both IDV & NCB
NCB Transfer
The insured bike gets the No Claim Bonus and not the driver. You can switch it during the renewal of your two wheeler insurance policy. ‘No Claim Bonus’ will be provided to you by your previous company without any additional cost.
Importance of NCB
NCB is essential as it plays a crucial role in cutting down the insurance premium amount of your two-wheeler. NCB percentage will increase for the subsequent claim-free years. The upper limit to NCB is 50%.
Is higher IDV better for two-wheelers?
Your bike insurance premium will depend on the Insured Declared Value, especially when you’ve purchased a comprehensive two-wheeler insurance policy. Your IDV depends on the age of your two-wheeler. If the age of your bike is less, higher will be the IDV and vice versa.
Does IDV matter?
IDV is considered to be one of the most important factors when it comes to deciding the insurance premium of your bike. You need to pay this premium during the insurance renewal or while purchasing your two-wheeler policy. The Insured Declared Value of your motorcycle is indicative of the present market value of your bike. It is basically the maximum amount that the insurer will pay to you if there is constructive total loss or theft.
How can you know the IDV of your bike?
It is calculated based on the selling price of your two-wheeler and after the depreciation value has been deducted. The IDV of your bike will keep reducing as its age increases. Here’s the formula by which you can calculate the IDV of a two-wheeler:
Insured Declared Value = (Listed selling price of a company – Depreciation value) + (the cost of bike’s accessories that are excluded from the listed selling price – their depreciation value)
What should be your bike’s IDV?
If you wish to know the accurate IDV of your two-wheeler, it is possible to do it online as well by using a two wheeler insurance premium calculator. You can find this on the official websites of the vehicle insurance companies. By using this online tool, it becomes easy to calculate the policy premium. For calculating your premium online, all you need to do is, visit the official website of the insurer and provide the required details. You will then know your two-wheeler’s exact IDV.
In a nutshell, both NCB and IDV are very important for deciding the insurance premium of your bike. Always remember to give away the correct value and save yourself from paying any extra money. If you need any advice regarding the same, you can also seek help from your insurance provider.