Two Wheeler Insurance

Know All About Bike Insurance in India

Introduction

A two wheeler insurance policy provides you with the financial shield against the losses or damages incurred on or by your two wheeler. If you do not have a valid two wheeler insurance policy, the cost of all the financial losses, which may incur on or by your bike, would have to be borne by you. So, it is advised to stay legally and financially protected with the shield of good two wheeler insurance policy at all times.

 

Is Two Wheeler Insurance Mandatory in India For Two Wheeler Owners?

All the motor vehicles plying on the Indian roads must have a valid motor insurance policy as per the Indian Motor Vehicles Act, 1988. It is illegal to ride your two wheeler, bike, scotty, scooter, or moped on Indian roads without having a mandatory third-party liability cover.

It is mandatory to have a valid bike insurance policy as it provides financial protection against unfortunate accidents, which may damage to third-party property, and/or cause bodily injuries to the third-party driver or rider, pillion rider, and/or pedestrians. In such cases, having a liability cover provides financial coverage, the insurance company pays compensation on behalf of the bike owner.

Basic About Bike Insurance

Premium

It is the fixed amount that you need to pay to the insurance agency to keep the policy in effect.

 

Two wheeler insurance Policy

The premium amount of the policy will depend upon the Insured Declared Value (IDV). This affects how high or low that amount will be. Many insurance firms have contacts with the manufacturers and provide you with the optimum value.

 Natural Calamities

This section includes protection against the following phenomenon: landslide, self-ignition, lightning, explosion, earthquake, flood, typhoon/hurricane, inundation, and hailstorm.

 Man-made Calamities

Under this, you will be covered against threats like burglary, theft, damage during transit, an accident caused due to external agents, terrorist activities, riots, and strikes.

 Two Wheeler Insurance Policy Assures:

 You Stay Financially Protected

A valid two wheeler insurance policy provides you with financial coverage in case of bike theft or any damage caused by or to your vehicle.

 You Are Legally Protected

It is mandatory to have a valid two wheeler insurance policy for your bike, scooter, sports bike, cruiser, etc. to ride them on Indian roads, so having a valid bike insurance policy keeps you legally protected.

 You Are Protected With Personal Accident Cover

In case the policyholder meets an accident, which causes a partial or total permanent disability or dies due to an accident, the insurance company covers the insured up to the sum of Rs.15 lakh.

 You Stay Worry-free

You can enjoy your ride without having any worries about riding your bike illegally, paying a hefty penalty, or paying from your pocket in case of third-party bodily injury or property damage.

Types of Two Wheeler Insurance Policies in India

There are two types of two wheeler insurance policies:

1. Third-party Liability Cover Only
   2. Comprehensive Policy or Package Policy or First-party

Two Wheeler Insurance Third-Party (TP) Liability Cover

Third-party liability bike insurance policy is mandatory in India as per the Indian Motor Vehicles Act, 1988.

Third-party two wheeler insurance policy covers only the damages or loss caused by the insured bike to the third-party either bodily injuries or property. In addition to that, a third-party bike insurance policy also provides a personal accident death cover of amount up to Rs.15 lakh for the policyholder.

However, you need to keep in mind that a TP policy offered by any of the insurance company will not cover any loss or damages incurred to own bike, or theft of the insured bike.

 Two Wheeler TP Liability Insurance Coverage:

Third party Liability Coverage: In case of third party bodily injury or death due to the insured two wheeler, the insurance company provides liability cover.

Third party property Damage Coverage: In case of any loss or damage to a third party property, the policy provides coverage up to an amount of Rs. 7.5 lakh.

Personal Accident Coverage: A third-party two wheeler insurance policy covers an owner-driver and optional pillion rider cover.

1. Owner-Driver Personal Accident Cover: In case of a permanent total disability or an accidental death, the policyholder is covered with a sum insured of up to Rs.15 lakh on an additional premium.
2. Pillion Rider Accident Cover: Add a pillion rider personal accident cover, which provides coverage up to the sum insured of Rs.1 lakh on an additional premium.

Personal Accident Cover Table:

Accidental Event	% of Sum Insured
Death	100%
Dismemberment of both the limbs or loss of vision in both eyes or one limb and one eye	100%
Dismemberment of one limb or loss of vision in one eye	50%
Permanent Total Disability	100%

What is not Covered in Liability Cover Only

• Own Damage of your two wheeler is not covered. Any damage incurred to the insured bike due to an accident is not covered. The policyholder will have to bear the repair cost himself or herself.
• Accidental damage/ liability/loss happened outside the specified geographical area.
• Damage, liability, loss happened due to invasion, war and other warlike operations.

Comprehensive Two Wheeler Insurance Policy

To protect your two wheeler completely, you will require a comprehensive two wheeler insurance policy. Because it provides a complete financial protection against own bike damages and also any third party loss or damages caused due to the insured vehicle.

You don’t have to worry, if your two wheeler gets stolen, as a comprehensive policy also covers bike theft to the limit of the IDV (Insured Declared Value) in the insurance policy. Moreover, the damage caused to your two wheeler, bike, scooter, or moped, in an accident will be borne by the insurance company.

Two Wheeler Comprehensive Insurance Policy

Coverage and Exclusions of Two Wheeler Comprehensive Cover
1) Own Damage
2) Third-party cover
a) Third-party liability cover
b) Third-party property damage cover
c) Personal Accident Cover:
i. Personal Accidental Cover for the owner-rider
ii. Optional (add-on) Pillion Rider Cover

 Coverage of Two Wheeler Comprehensive Policy are:

 Own Damage: A comprehensive two-wheeler insurance policy provides financial protection against any damage that may incur due to any man-made or natural calamities.

For instance, if your bike gets burned due to malicious act or gets stolen, you will be compensated under a comprehensive bike insurance policy.

A comprehensive bike insurance policy not only covers bike own damage repair costs but also protects you against  third party liability. With a comprehensive two wheeler insurance you are compensated for both own damage and third party losses.

 Inclusions of Two Wheeler Comprehensive Insurance Cover

Under a comprehensive two wheeler insurance policy, your bike is protected, in case if there is any loss or damage as a result of:

• Fire, , self-ignition, explosion or lightning
  • Earthquake, storm ,typhoon, hurricane, flood, tempest, inundation
  • Cyclone, hailstorm, frost, landslide, rockslide
  • Burglary, theft, riot, strike, malicious act
  • Accident by external means, terrorist activity
  • Any damage or loss due to transit by rail, road or inland waterway, lift, elevator or air
  • Extra Coverage if an add-on is attached to the base comprehensive insurance policy

 Exclusions of Two Wheeler Comprehensive Insurance Cover

While a comprehensive two wheeler insurance policy covers  damages/losses due to any man-made and natural perils to your vehicle, but there are certain exclusions:

• Any damages incurred when the policy is expired or not active
  • Wear and tear of the two-wheeler due to aging
  • Any electrical or mechanical fault breakdown
  • Riding without valid or proper license
  • Riding under the influence of alcohol, drugs or any intoxicants
  • Accident due to involvement in a criminal or illegal activity
  • Using private two-wheeler for commercial purposes is not covered

 Differences Between Two Wheeler Liability Cover and Comprehensive Two Wheeler Insurance

Let us see an example to understand the difference between a liability cover and comprehensive cover.

Example: Amit and Sanjay bought a new Honda CB Unicorn self-starter 150ccbike in Jan’19. The on-road price in Mumbai is Rs.89,900/-.

Amit insured bike with only a Third-party cover. Third-party premiums is on the basis of Engine CC. So the premium is Rs.770/-.

While Sanjay bought a Comprehensive policy (covers own damage + third party liability cover), which cost him Rs.1900 /-.

In the month of June, both met an accident and it was their fault.  And the total repair cost turns out to be Rs.8,000 (approx.).

As Amit had purchased only third party coverage, the whole repair cost of his two wheeler will have to be borne by him. The insurance company will pay only third party property damage cost. Nothing for any damages incurred on the bike.

Since, Sanjay had bought a comprehensive policy, the insurance company will pay the repair cost (after deduction for the depreciable parts cost) on behalf of him.

Key Points	Amit	Sanjay
Premium Paid	Rs.770/- (only third-party)	Rs.1,900(Comprehensive)
Third-party	Paid by the insurance company	Paid by the insurance company
Own- Damage Repair Cost Rs.8,000/-	Not paid by the insurance company	Paid by the insurance company
Total Money Invested	Rs.770 + Rs.8,000	Rs.1,900
Net Savings (Rs.)	0/-	More than approx. Rs.5,000

Total Money paid by Amit is Rs.8,770, whereas, Sanjay paid Rs.1900. On the face value, Amit saved money on the premiums paid. However, he had to suffer a huge financial  loss of money that came along with the bike damage. The total loss borne by Amit is of Rs.8,770.

Note: All the prices are indicative and are subject to change.

 The Differences Between Two Wheeler Third Party Liability Cover and Comprehensive

Coverage	Third Party Policy only	Comprehensive Policy
Third Party Liability	✓  Covered	✓ Covered
Third Party Property Damage	✓  Covered	✓ Covered
Personal Accident Cover	✓  Covered	✓ Covered
Own Damage	X   Not Covered	✓  Covered
Vehicle Theft	X   Not Covered	✓  Covered
Add-on Covers (Extra Protection Shield)	X Cannot be added	✓ Can be added

What is Add-on Cover in Two Wheeler Insurance?

These are optional add-on paid features that you can avail by paying a little extra premium on your comprehensive two wheeler insurance policy. The add-on cover provide extra protection in addition to your base two-wheeler insurance policy.

 Here’s the list of Two Wheeler Add-on Covers:

 Zero Depreciation or Nil Depreciation Add-on Cover

At the time of claim, the insurance companies do not pay the complete repair or replacement cost of your bike’s depreciable parts. Depreciable bike parts such as rubber, plastic, metal are not fully covered. The depreciable cost is deducted at the time of claim repair. And this must be borne by you.

But with the help of two-wheeler comprehensive insurance with zero depreciation add-on cover, you stay covered for those depreciable repair or replacement costs. Because of this add-on cover, the insurance company pays the full amount of repair and/or replacement at the time of claim except for tyre(s) and tube(s).

Engine Protector

The damage incurred to the engine is not covered even under the base comprehensive bike insurance policy.

So, the damage to the Engine or Gearbox due to the leakage of lubricating oil, water ingression, clogging can be covered under the Engine Protector add-on.

The insured bike gets covered in case of repair or replacement of crankshaft, pistons, connecting rods, gear shafts in gearbox, etc.

 Compare To Choose The Best Two Wheeler Insurance

To get the best two-wheeler insurance you need to compare between the plans offered by top insurance companies. 365 Suraksha provides you a simple and seamless two wheeler insurance comparison platform. By simply entering your bike’s registered number, you will get quotes from top insurers providing third party and comprehensive two wheeler insurance for your bike.

 

Below are the steps you should follow to gain awareness about the comparison process before you get into actually doing it.

 Step 1: Identify Your Needs

In order to compare two wheeler insurance plans, you must first know exactly what you expect from it. If an insurance policy is providing you with a few more features than the other, but has a much higher premium, you need to analyse exactly how beneficial these features are going to be and whether the higher premium will be worth the additional value you derive from your policy.

 Step 2: Decide Your Budget

Budgeting out your insurance coverage will narrow down your search options by filtering out the expensive policies. This way, you will also know the specifications you are eligible for depending on the money you can spend for your vehicle’s security.

 Step 3: Find the Right Source of Information

There are multiple websites that allow you to compare information about insurance policies and companies. But how many of them are reliable? It is better to opt for a trustworthy and authorized source like 365 Suraksha

, for example, which provides you with accurate and continuously updated data of various two-wheeler insurers.

 Step 4: Weigh the Pros and Cons

Sometimes, two policies may seem to suit your needs the same way, but since you can’t buy them all, you need to make a difficult yet worthy decision between them. In such cases, it is better to analyse the pros and cons of each policy so it will help you finalize on one that stands out from the rest.

 Step 5: Take Your Time

The most necessary step is to not rush into the procedure. It is better to use the time during the research phase than regret your choice later and not be able to do anything about it. Take your own time before you decide.

Two Wheeler Insurance Claim Process

There are two types of claims in  two wheeler insurance – Cashless claims and Reimbursement claims.

 Cashless Claims

If you take your two wheeler to any of these network garages, then you need not make any payment to the garage. The payment is taken care of directly by the insurance company. These claims are called cashless claims.

 Reimbursement Claims

In case due to any reason you cannot take your vehicle to a network garage, then you need to make the payment out of your pocket and then make a reimbursement claim to the insurance company.

 Procedure for Cashless Two Wheeler Insurance Claims:

• If you meet with an accident that involves another vehicle or person, then note down their names, contact details, and the number of the vehicle.
• The next thing to do is contact insurance company on their claims report phone number or email them and you will be contacted by the call centre representative. The call centre representative will direct you to the nearest network garage and give you a claim number. This is the reference number you will need to use for any queries regarding this claim. The representative will also inform you about all the documents required to process the claim.
• If it is a major accident or results in any bodily harm or damage to a third party, or loss or theft is involved, then you need to file an FIR at the police station nearest to the area of the incident.
• Once this is done, you can take your vehicle to the network garage that was suggested to you by the call centre representative.
• Within 24 to 48 hours of the claim being registered, you will be contacted by a surveyor or a customer relationship manager (CRM) for two-wheeler insurance from the insurance company. The CRM will verify all your documents, get an estimate of the amount required for the repairs of the vehicle, and then give approval based on their assessment.
• All the payments that should be made by the insurer will be made directly to the network garage. There will be a small amount you will need to pay as per the terms and conditions of your insurance policy. You can make this payment to the garage.

 Procedure for Reimbursement Two Wheeler Insurance Claims:

• If you are unable to visit the network garage and you get the repairs done from another garage, your claim amount will be paid directly to you.
• Follow the first three steps mentioned above for registering your claim and filing an FIR.
  • The CRM will contact you within 24 hours of registering the claim, inspect the damages, and reach an estimate for the repairs. The CRM may also take photographs of the damages for proof.
• You can then take your vehicle to your preferred garage and get it repaired. The CRM will need to verify the repairs once they are done.
• You can pay the garage for the repairs and get a proof of release document from them. You need to submit this document along with the original bill and cash receipt to the CRM.
• The CRM will then verify all the documents and submit it to the insurance company’s claim processing department for claim settlement.
• Once the documents are received by the insurer, the claim process will be initiated and the claim amount for the two-wheeler insurance from the insurance company will be paid directly to you within 7 to 10 working days from the date of receipt of the documents.

Note – The above is a general procedure and it can vary from company to company.

GST on Motor Insurance Policy

The GST was implemented by the government to centralise the tax imposition in the country. The two wheeler insurance has been categorised under general insurance class in GST. Due to this  a GST of 18% is levied on two-wheeler insurance. This means there is a hike of 3% with regards to tax on bike insurance. This has made two wheeler insurance slightly more expensive than the previous tax rules.

 

 

 

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