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Why should you buy a two-wheeler insurance policy?

Team AckoFeb 27, 2024

A two-wheeler being one of the most convenient options for daily commute is a popular choice of vehicle in India. So much that in 2021 there were a whopping 1.5+ crore two-wheelers running on the road. Bikes or scooters provide speed, enhanced manoeuvring through small gaps in traffic, and most importantly buying and maintaining it is less of a burden on the pocket.

Two-wheelers have a lot of plus points but they are also risky and prone to accidents. So what would be your option for a financial backup? It is insurance. Let’s discuss why you must buy a two-wheeler insurance policy.

Contents

Top 5 reasons for investing in a good bike insurance policy
What should you know before buying bike insurance?
- Why is bike insurance important?
- How does buying bike insurance from ACKO help?
Takeaway
Frequently asked questions

Top 5 reasons for investing in a good bike insurance policy

Here is a list of reasons why you must consider investing time and money in buying a suitable bike insurance policy.

1. It is compulsory by law

All vehicle-related rules and laws are mentioned in The Motor Vehicles Act, 1988. This act states that buying bike insurance is compulsory for all bike owners. If you fail to do so, it will be considered against the law and you must pay fines.

If you get caught once, the penalty for riding a two-wheeler without insurance is Rs. 2000. Repeated offences will attract an increased sum of money. But be aware, as you may also face imprisonment for up to 3 months if you fail to get the bike insured.

2. It allows you to pay third-party compensation

As mentioned earlier, bikes are riskier as compared to the closed-door protection offered by a car or other vehicles. Plus, you need to balance the bike at all times during the ride. If there is an accident, you might not be the only one to get injured. There could be other victims i.e. a third party too.

The law says that you must bear the cost of loss suffered by the third party if you are responsible for the accident. This loss can amount to lakhs of rupees depending on the extent of damage caused, and the severity of the accident. Buying bike insurance will help you bear the cost related to injuries, death, or property damage. So, you can provide timely compensation to the victims.

3. It helps you pay the repair bill in case of accidents

Sometimes people tend to avoid bike repairs if they are facing a temporary financial crunch. Opting for other types of transport is quite common in such cases. Here is an example.

Tushar owned an Activa and it got damaged in an accident. He had the basic type of bike insurance policy i.e. Third-party Plan. Since he did not have enough insurance coverage for bike repairs, it was upon Tushar to spend money from his pocket.

Due to a financial crunch, he delayed the repairs and opted to travel by a shared auto-rickshaw for nearly a month. Sometimes he had to wait in a long queue for his turn to hire the ride. Also, the total amount of money he spent through this mode of transport was way more as compared to the cost of fuel for the bike.

Tushar wouldn’t have to spend so much if he would have bought adequate insurance coverage for the bike as the repairs could have been completed promptly.

4. You can claim the approx. market value of the bike if it gets stolen

Buying a Comprehensive Bike Insurance Policy allows you to rest assured against the risk of bike thefts. If in case your bike gets stolen, then you can collect supporting documents and raise a claim. There is a component of bike insurance called IDV (Insured Declared Value). You need to set this amount and it is crucial that you set it correctly.

The trick is to consider the approximate current market value of the bike and set the IDV in that range. Your insurer will pay the IDV of your bike if the claim is approved. Thus, you face minimum financial loss even in the case of bike theft.

5. You will get compensation when a natural or man-made calamity occurs

A major misconception many people have is that damage from natural calamities is not covered under bike insurance. Well, it is. Motor insurance helps you out if the bike gets damaged in a natural or man-made calamity like floods, earthquakes, riots, vandalism, landslide, etc.

What should you know before buying bike insurance?

Following is the list of things you must consider before buying bike insurance.

1. Reliability of the insurer

The reliability of the insurance company must be taken into consideration before buying an insurance plan from them. One of the many ways to find if an insurer is reliable is to visit their social media handles and check the customer reviews. The number of positive reviews should be more than the negative ones.

2. Adequate coverage

Bike insurance offers monetary backup so that you don’t suffer high financial losses in case of bike damage. But it is crucial that you buy suitable insurance coverage in the first place. Inadequate coverage can lead to claim rejection and eventually disappointment.

3. Understand the exclusions

Coverages are important and so are exclusions, i.e. things that are not covered under the bike insurance policy. You must be fully aware of exclusions so that you know in which situations you can raise a claim.

4. Read the terms and conditions

Some people tend to overlook the basic terms and conditions pertaining to the features of the bike insurance policy. But doing so can be counter-productive. It may lead to claim rejection. As tiring as it may seem, you must go through the basic terms of the policy and contact the insurance company in case of doubts.

5. Renew by the due date

Buying bike insurance is not a one-time process. It requires you to buy fresh coverage every time upon the expiry of the current plan. This also helps you to add or drop certain coverages from the plan depending upon your requirement. Always remember, renewing bike insurance is crucial for receiving continued coverage.

Why is bike insurance important?

Buying bike insurance is not only necessary for creating a financial backup but it is also important to stay on the right side of the law. It helps you avoid traffic fines and challans. Bike insurance is like wearing virtual safety gear against financial losses caused due to bike damage.

How does buying bike insurance from ACKO help?

At ACKO you will have access to many benefits when you buy bike insurance. We not only provide a suitable policy at the best rates but also help you renew seamlessly. ACKO’s claim process is also straightforward and transparent. A unique feature called “Instant claim settlement” allows you to raise a claim for minor damages and receive the claim amount instantly. No waiting for long periods of time to complete repairs. All this at significantly lower premiums. Click the link to get a free bike insurance quote instantly.

Takeaway

In India, a major portion of bike owners avoids buying an insurance policy. As per the General Insurance Council of India report, a whopping 60% of the registered bikes (from 2015-16) don’t have a valid bike insurance policy. As explained in the above article, not insuring your bike can have serious consequences ranging from fines to imprisonment. Think about it this way, if you buy a bike insurance policy you are securing yourself from heavy financial loss if you get into an accident or injure someone else. So, buy a suitable policy and renew it on time.

Frequently asked questions

Here is a list of questions related to bike insurance. You can get in touch with us at [email protected] in case of more queries.

If a third party is other people on the road, what are first and second parties?

As a bike owner and a policyholder, you are the first party. Your bike insurance company is the second party and everyone else becomes the third party.

Can I opt for a monthly cycle for bike insurance payment?

Payment cycles depend upon the terms and conditions of the insurance company. Usually, you must pay the premium in one go. However, if your insurance company allows you to opt for a monthly cycle then you can.

Can I set the IDV for my bike while buying a Third-party Liability Plan?

No, IDV is simply not required when you buy a Third-party policy because this plan does not insure your bike.

Disclaimer: The content on this page is generic and shared only for informational and explanatory purposes. It is based on industry experience and several secondary sources on the internet; and is subject to changes. Please go through the applicable policy wordings for updated ACKO-centric content and before making any insurance-related decisions. Explore More: