Important Two-wheeler Insurance Terms to Remember

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Buying a bike insurance policy online makes the process extremely convenient. It is a known fact that a large percentage of bike owners flout the traffic rules, and consequently, it leads to a rise in the number of accidents. Even an experienced bike owner is likely to face a road accident, maybe even due to no fault of their own. For tackling such situations, a bike insurance policy is an exceptional way to cover the accident costs. Along with this, it is a legal compulsion to have third-party bike insurance for driving the vehicles legally on the road.

Purchasing Bike Insurance Online

One of the most effective ways of purchasing the policy is getting two-wheeler insurance online. When you decide to get motorcycle insurance online, you get the opportunity of comparing different plans, checking out the bike insurance price and understanding their suitability. To make purchasing the policy easier for customers, insurance companies provide the two-wheeler insurance premium calculator on their websites. A bike insurance calculator is a free tool that helps you purchase the plan. You will have to provide specific details about your insurance policy, the bike and some personal details on the calculator.

The calculator will take into account the details you have provided, and you’ll get an estimate of the premium amount you will have to pay for the plan. The results from the calculator will solely depend on the information you provide. However, if you’re purchasing bike insurance for the first time, then some of the jargons used around the insurance plans may seem a bit confusing. You can refer to the terms listed below to get a better understanding of these jargons.

Some essential jargons two-wheeler insurance policy to know:

  • Coverage:

This refers to the maximum sum assured or the financial cover that a policyholder gets from the insurance company when they file a claim for damage to or loss of the vehicle.

  • First, second and third-party:

The insured member, along with their bike, is labelled the first-party. The insurance provider that offers insurance coverage is known as the second party. The individuals involved in the accident with the first-party are called the third-party.

  • Third-party liability cover:

The third-party cover provides compensation for the damages to the third-party property or person in the event of an accident with the insured vehicle. As per Indian laws, every bike owner has a legal compulsion to have third-party coverage for their bike. But the cover will not provide financial support for damages to the policyholder or their bike.

  • Premiums:

A premium is a monthly or annual amount you pay the insurer for providing you with the insurance policy. Policyholders must pay their premiums on time before the policy tenure ends to maintain the cover. The amount paid as bike insurance premium will depend on the model, add-on benefits, cost and make etc.

  • NCB (No Claim Bonus):

If the insured individual has not filed any claims in the previous policy term, they get a discount on the premium at policy renewal. The discount is offered as a percentage discount on the premium amount. The more the number of years during which the policyholder does not file the claim, the higher the discount they get from the NCB.

  • Comprehensive cover:

Comprehensive bike insurance provides more extensive coverage compared to the third-party policy. This cover also provides financial support for the damages sustained by the policyholder. Apart from this, it covers the insured against damages caused by theft, artificial or natural calamities, etc. You can even buy the add-ons to increase the benefits of the plan.

  • IDV (Insured Declared Value):

The IDV is the highest amount that an insurance company can provide if the insured bike is either stolen or damaged beyond repair. The IDV is the two-wheeler’s current market value.

  • Personal Accident Cover:

It is also a law-mandated cover. This plan will compensate the insured if they face some injuries or pass away because of an accident. You also get compensation to the rider in the event of total or partial disability.

  • Zero Depreciation Cover:

The cover will offer zero deduction on the value of the parts being replaced during the bike’s repair without factoring in the depreciation. It means the policyholder will get the complete replacement cost instead of the depreciated amount at the time of claim filing. Including the cover is optional and can be availed with a new policy as well as during renewal.

  • Exclusions:

Before you buy the policy, you must go through the policy documents to check what is excluded from your coverage. Hence, it is necessary to also read the offer document carefully. It will be useful when you have to file a claim. You can opt for an additional cover at any time if your policy excludes a certain benefit.

It can be difficult for a new policy buyer to purchase a suitable plan if they do not have a basic understanding of two-wheeler insurance plans. If you plan to buy an insurance policy for your bike, you can refer to the terms listed above to get a detailed understanding of these terms.