Mini guide for two wheeler insurance

Two-wheeler insurance policies are a policy that covers insurance of bikes. As per the Motor Vehicles Act’s provisions, 1988 traffic rules need to be followed by every vehicle running on the roads. The insurance policy provides coverage against the accidents caused by the bikes or suffered by the bike as per the type of the policy purchased.

There are distinct bike insurance plans available. We will discuss them over here. There are two main types of bike insurance plans available in the market. They are as follows:

Mini guide for two wheeler insurance

  1. Third-Party Liability Insurance Policy

This policy is the requisite cover which is specified under the Motor Vehicles Act, 1988. This is mandatory to be purchased for every bike which is used in India. This policy provides coverage for any damage or injuries caused to a third party or other individuals due to your bike. This insurance policy covers the following types of financial liabilities:

  • Liability is faced when an individual is hurt due to your bike.
  • Liability is faced when an individual is killed due to your bike.
  • Liability is faced when an individual’s property is damaged due to the bike.

A third-party liability policy covers only third-party legal liabilities. In this policy, the premiums are low compared to the comprehensive package policy and are fixed by the insurance regulatory and development authority. The premiums are also one and the same across all insurance companies. If we talk about coverage limits, then accidental deaths and physical injuries have no coverage limits. They are covered for an infinite amount. Property damage coverage is, however, available for up to INR 7.5 lakhs. Add-ons are not available in a third-party liability insurance policy. Premium always depends on the engine capacity of the bike. This policy is not applicable for premium discounts and No claim bonus. Previously, it could be purchased for one year or a longer duration of 2 or 3 years. But now, for new bikes bought after 1st September 2018, the coverage duration should be 5 years.

  1. Comprehensive Package Policy

This policy provides a vast scope of coverage to the bike. It covers the mandatory third-party liability coverage as well as damages suffered by the bike itself. Comprehensive package policy, therefore, has full coverage benefit and is priced higher than third-party plans. This insurance policy covers the following types of liabilities:

  • Financial loss suffered when the bike is damaged due to natural causes like floods, earthquakes, lightning, landslides, cyclones, etc., or damage caused due to human-made causes like fire, explosion, malicious acts, riots, strikes, etc.
  • Financial loss suffered when the bike is stolen, and also the damage caused is covered when the bike is being moved from one place to another through road, rail, or air.

Comprehensive package policy covers third-party legal liability and damages suffered by the bike. The premium rates are higher as compared to the third-party policy, and the insurance company itself fixes them. And so, the premium differs across all insurance companies. A range of add-ons is available, which can be selected at additional premiums.

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