Owning a bike is not just about the thrill of the ride; it also comes with responsibilities. One of them is ensuring that your bike insurance is in place and up to date. Whether you are purchasing a new policy or renewing an existing one, checking your insurance documents thoroughly is crucial. Any oversight can lead to trouble during claims or legal issues on the road.
Let’s walk through the key things you must verify in your bike insurance documents.
1. Check the Policy Type: Third-Party or Comprehensive
Your two-wheeler insurance will be either third-party or comprehensive bike insurance.
- Third-party insurance: This covers damages caused to a third party (person, vehicle, or property) but does not cover your own bike’s damages.
- Comprehensive bike insurance: This offers broader coverage, including third-party liabilities and damages to your own vehicle due to accidents, theft, natural calamities, and man-made disasters.
2. Verify Personal Details
Your insurance document should accurately reflect your details, including:
- Name
- Address
- Bike’s registration number
- Engine and chassis number
Any errors in these details can cause unnecessary trouble when filing a claim. If you spot a mistake, contact your insurer immediately to get it corrected.
3. Policy Start and Expiry Date
Always note the start and expiry date of your insurance policy. If your bike insurance expires, you lose coverage, and riding without valid insurance can attract heavy fines. Set a reminder for renewal before the policy lapses to avoid inconvenience.
4. Insured Declared Value (IDV)
The Insured Declared Value (IDV) is the current market value of your bike, which determines the maximum compensation you will receive in case of theft or total loss. If the IDV is too low, you might get a lesser payout. If it’s too high, you might end up paying a higher premium. Always ensure that your IDV is set correctly according to your bike’s age and market value.
5. Coverage Details
Carefully check the coverage offered under your comprehensive bike insurance. Your policy should mention coverage for:
- Accidents and damages
- Theft
- Fire
- Natural disasters (floods, earthquakes, etc.)
- Man-made disasters (riots, vandalism, etc.)
- Third-party liabilities
6. Exclusions – What’s Not Covered?
Every policy has exclusions, which are scenarios where your insurance will not cover damages. Common exclusions include:
- Wear and tear
- Mechanical or electrical breakdowns
- Riding without a valid licence
- Driving under the influence of alcohol or drugs
- Using the bike for illegal activities
Understanding these exclusions will help you avoid claim rejections.
7. No Claim Bonus (NCB) Details
If you have a claim-free year, you are eligible for a No Claim Bonus (NCB), which offers a discount on your renewal premium. Check if your NCB is correctly mentioned in your policy document. The NCB can range from 20% to 50%, depending on the number of claim-free years.
8. Add-ons and Riders
If you’ve opted for add-ons like:
- Zero depreciation cover
- Roadside assistance
- Engine protection
- Return to invoice cover
Ensure these are clearly mentioned in your policy document. Add-ons enhance your coverage and offer better financial protection.
9. Premium Amount and Breakup
Your policy document should show a clear breakdown of:
- Premium for own damage cover
- Premium for third-party liability
- GST and other applicable taxes
- Add-on cover charges
Cross-check these details to confirm that you are being charged correctly.
10. Claim Process and Contact Details
Understanding the claim process beforehand will save you time and effort during an emergency. Your bike insurance policy document should mention:
- How to file a claim
- Required documents for claim settlement
- Toll-free number for claim assistance
- List of network garages (for cashless claims)
Having this information handy ensures a hassle-free claim process when needed.
11. Legal Compliance and IRDAI Approval
Ensure that your bike insurance policy is issued by an insurer registered with the Insurance Regulatory and Development Authority of India (IRDAI). This ensures that your policy is legally valid and meets Indian regulatory requirements.
12. Voluntary Deductibles and Compulsory Deductibles
A deductible is the amount you need to pay from your pocket before the insurance company covers the remaining claim amount. There are two types:
- Compulsory deductible: A fixed amount you must pay for every claim.
- Voluntary deductible: An amount chosen by you, which helps reduce the premium but increases your out-of-pocket expenses during claims.
Check your policy for the deductible amount and ensure it aligns with your financial preferences.
13. Policy Endorsements and Amendments
Sometimes, you may need to make modifications to your bike insurance policy, such as changing your address, adding an add-on, or transferring the policy to a new owner. These changes are called endorsements. Check your policy for any endorsements and verify if they are correctly mentioned.
14. Policy Cancellation Terms
In case you wish to cancel your insurance policy due to dissatisfaction or selling your bike, check the cancellation terms mentioned in the document. Some insurers provide a refund if the cancellation is done within a specific period, while others may charge a cancellation fee.
15. Understanding Depreciation and Its Impact on Claims
Depreciation refers to the reduction in the value of your bike and its parts over time. In a standard bike insurance policy, depreciation is deducted from the claim amount. However, with a zero depreciation add-on, you can avoid these deductions and receive the full claim amount without depreciation cuts.
16. Cashless vs Reimbursement Claims
Your policy document should mention whether your insurer offers cashless claims (where repairs are done at network garages without upfront payment) or reimbursement claims (where you pay first and get reimbursed later). Knowing this detail will help you plan better during an accident.
Conclusion
Checking your bike insurance documents may seem tedious, but it’s essential for a smooth insurance experience. Mistakes in the policy document can lead to complications during claims, and missing coverage details can result in financial losses. Always verify your details, coverage, exclusions, and premium breakdown before finalising your policy.
