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What is Two Wheeler Insurance and how does it work?

What is Two Wheeler Insurance and how does it work

Two wheeler insurance or Bike Insurance provides financial assistance in case of damage done to two wheeler or bike due to accident, theft, or natural disaster. Two Wheeler insurance also provides third party liabilities arising from injuries due to accident. One should understand two wheeler insurance, benefits, what is covered and exclusions etc. Which would help you in taking an ideal plan and claim appropriately. What is Two Wheeler Insurance? How does two wheeler or bike insurance work exactly?

What is Two Wheeler Insurance?

Two Wheeler insurance also termed as bike insurance is an insurance policy that covers against damages to the two wheeler due to accident, theft or due to natural disasters. It basically provides financial assistance to two wheeler owner in case of bike accidents.

Third party bike insurance is mandatory in India as per Motor Vehicles Act 1988.

How does Bike Insurance work exactly?

Here is how the vehicle insurance work.

Two wheeler owner purchases bike insurance

Two wheeler had an accident and got damaged

Vehicle owner visits network garage for two wheeler repair

Garage agent would send quote to the insurance company.

Insurance company reviews and approves the claim

Garage agent repairs the bike and is delivered to bike owner.

Why should you buy Two Wheeler or Bike Insurance?

Here are a few reasons to buy a two wheeler insurance in India.

1) Two Wheeler insurance provides financial assistance in case of damage done to the bike due to accident or in case it is stolen (theft).

2) Two wheeler insurance can be purchased within the 2 ms timeframe.

What are the different types of Bike Insurance in India?

There are basically two types of bike insurance:

1) Third Party Bike Insurance

As the name indicates, third party bike insurance provides third party insurance in case of an accident. It safeguards the rider against all legal obligations arising due to damage to third parties. However, one should note that it covers only third party and not own vehicle damage. One should always avoid such plans.

2) Comprehensive Bike Insurance

This insurance variant covers both third party liabilities + own damages to the two wheeler. It safeguards your bike from fire, natural disasters, accidents, thefts etc., It also provides personal accident coverage in case of accident caused to you while riding the bike.

What are various Benefits in Two wheeler insurance?

Life is uncertain. If you are driving a two wheeler, road condition, climate condition and unregulated traffic would affect your vehicle. You might be travelling on the road with potholes, muddy areas etc., Vehicle owners can have accidents due to such situations.

Here are various benefits in two wheeler insurance.

1) Financial Assistance

Bike insurance provides financial assistance in case bike is met with an accident or there is loss due to theft or natural disasters. These days small damage to vehicles costs thousands of rupees, hence bike insurance can provide financial protection.

2) Personal Accident Cover

While bike insurance covers damage to the vehicle, it also provides personal accident cover in case of injuries you may have suffered due to the accident. Recently IRDA has increased the personal accident cover from Rs 1 Lakh to Rs 15 Lakhs.

3) Roadside Assistance

Gone are the days where one used to take a simple bike insurance. Now insurance companies offer roadside assistance support even for two wheeler insurance. One can consider such add-on, however, these features come with additional premium.

4) No claim Bonus

NCB or No claim bonus is the benefit provided by the insurance company in case there are no claims made in the previous year. Such benefit is provided by way of discount in the two wheeler insurance premium.

What are Add-Ons in Two Wheeler Insurance?

Insurance companies offer several add-ons in two wheeler insurance plans. Below is the list of add=ons.

1) Zero Depreciation cover

Generally, insurance companies would deduct depreciation while settling any claims. However, under this add-on, they would pay 100% of the bike value without deducting any deprecation amount.

2) Emergency Roadside assistance Coverage

This add-on would help you for roadside assistance in case your vehicle stopped in the middle of the road.  The roadside assistance services include tyre changes, battery issues, towing charges, replacement key, fuel arrangement etc.,

3) Daily cash benefit

Under this add-on, in case your vehicle is damaged and is in the garage for repairs, one would get daily cash benefit.

4) Return to invoice

This is a good feature in two wheeler insurance. Generally insured declared value (IDV) is computed after considering purchase price and depreciation year on year and accessories cost. However, when years pass-on, the IDV would keep reducing. Under this return to invoice add-on, in case of total damage due to accident or in case of theft, the total purchase price can be claimed which includes registration and taxes too.

What is covered in Two Wheeler Insurance?

It covers the following:

1) Third party liabilities damages

2) Damage done to the bike due to accident

3) Personal accident insurance in case of injuries to the rider

4) Damages or losses suffered due to natural calamities

5) Losses and damages due to man-made calamities like strike, riot etc.

6) Theft and burglary

7) Losses and damages to vehicle due to fire and explosion

What is not covered under two wheeler insurance?

Below are not covered in bike insurance.

1) Damage to vehicle due to regular wear and tear

2) Damage due to electrical and mechanical breakdowns

3) Deprecation of the vehicle

4) Damage to tubes and tyres due to regular usage

5) Damage to a vehicle caused by a person who is driving and is without a valid driving license

6) Loss or damage to the vehicle caused by a person under the influence of alcohol or drugs

6) Loss or damage to vehicle happened due to war or nuclear risk.

Understanding these two wheeler benefits, what is covered and what is not covered would help you to take right two wheeler insurance plan and claim appropriately.

Suresh KP

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