When you purchase insurance for a two-wheeler, you get coverage based on the type of policy you choose. There are two broad types of two-wheeler insurance policies – third-party liability plans and comprehensive bike insurance plans. When you decide to buy a two-wheeler insurance policy, you need to choose between the two based on your needs. Many bike owners are not clear about the differences between the two. In this article, we will talk about bike insurance 3rd party and a comprehensive policy for bikes.
Two-wheeler insurance plans are valid for a fixed policy term. You are required to renew the policy on or before its last date. Failure to do so can result in the policy lapsing or expiring. You can also opt for a long-term two-wheeler insurance policy to avoid the hassle of renewing it every year.
What is Third-party Two-wheeler Insurance?
The Motor Vehicles Act of 1988 makes it mandatory for all two-wheelers in India to have a bike insurance policy with a minimum of third-party liability coverage. This means that if your bike meets with an accident and causes damage to a third-party person or property, then the insurance policy offers coverage. The premium for a third-party policy is regulated by the Insurance Regulatory and Development Authority of India (IRDAI) and is very affordable. Hence, you are free from any financial strain due to any damage to a third party in the event of an accident.
However, these policies do not offer coverage for damages to the insured bike.
What is Comprehensive Bike Insurance?
A comprehensive bike insurance policy offers coverage for damages to a third-party person or property and to the insured bike. These policies are not mandatory but offer coverage for damages to your bike for various reasons, including accidents, collisions, fire, theft, natural disasters, and man-made disasters. You can also buy add-on covers to boost the coverage based on your requirements. The premium of a comprehensive bike insurance policy depends on a range of factors like the make and model of the bike, its age, location, engine capacity, the choice of add-on covers, deductibles, etc.
How Can I Tell if My Insurance is Comprehensive or Third-party?
When you buy a bike insurance policy, the insurance provider sends policy documents to you. If you are making the purchase online, then the insurer sends the policy documents to your registered email address. If you purchase it offline, then the insurer sends physical copies of the documents to you.
These documents highlight the details of the policy, its type, inclusions, and exclusions. If you go through them, you can understand the type of policy you have purchased and the scope and extent of the coverage offered.
Which Insurance is Best for Your Bike — Third-party or Comprehensive?
A third-party bike insurance plan only covers damages caused to a third-party person or property. It does not offer coverage for damages to the insured two-wheeler. This is a mandatory policy and highly affordable. On the other hand, a comprehensive bike insurance policy offers third-party liability cover plus coverage for damage to the insured bike due to an accident, collision, theft, fire, man-made disaster, or natural disaster. However, these policies are costlier than third-party policies.
Before choosing one, make sure that you assess your expected use of the bike and get an estimate of the repair costs. This can help you decide if you need coverage for your bike or just the compulsory third-party plan. Typically, people who buy an old bike or are looking for affordable bike insurance plans to meet the legal requirements opt for a third-party bike insurance policy. On the other hand, bike owners seeking maximum protection or people buying an expensive two-wheeler tend to opt for a comprehensive policy.
Conclusion
When you purchase a two-wheeler, you need to think about the type of insurance policy you would want to buy for it. Remember, accidents and disasters cannot be predicted or avoided at all times. Therefore, it is prudent to keep yourself financially protected from expenses arising due to the repairs of your bike if it gets damaged for any reason. Hence, make sure that you assess your bike insurance needs and choose a policy that helps you get the right coverage at the right price.