With over 21 crore registered two-wheelers on Indian roads, as reported by The Economic Times, there has been a sharp rise in traffic density, accident rates, and theft incidents.
This is the reason 2-wheeler insurance has become more than just a legal requirement. However, while choosing a policy, it is essential to consider what determines the price you pay for it.
In most cases, 2-wheeler insurance premiums vary based on your bike’s model, riding habits, and coverage choices. Read on to discover these factors and get the best 2-wheeler coverage at an affordable rate in India.
What are the 8 Essential Factors That Can Impact Your 2-Wheeler Insurance Premium?
If you are wondering what factors can affect two-wheeler insurance premiums, have a look at the section below.
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Coverage Type
Choosing between third-party and comprehensive 2-wheeler insurance can significantly vary your premium. This is because, since third-party insurance only covers the damages or injury of a third party involved in an accident, its premium is significantly lower.
Meanwhile, the comprehensive policy comes with a higher premium as it covers own damages and injuries along with third-party damages.
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Bike Model
Insurers give great importance to your bike’s make and model while determining the premium amount of your 2-wheeler Insurance. For instance, if you own premium high-end models like Royal Enfield, the premium amount will increase due to their expensive repair and replacement costs.
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Insured Declared Value
Insured Declared Value or IDV represents the current market value of your bike. This value will decide how much compensation you can claim for your 2-wheeler if it’s stolen or completely damaged. Therefore, if your bike has a low IDV, it will automatically make the premium amount of your 2-wheeler insurance low.
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Details of Policyholder
To determine the premium amounts for a bike insurance policy, insurers evaluate the policyholder’s personal details, including geographical location, age, and riding experience. For instance, if you have a record of accidents in your driving history, the insurer views you as being at a higher risk of making frequent claims, which can result in a higher premium.
Similarly, a 30-year-old policyholder with 10 years of riding experience will be paying a lower premium compared to someone with less than a year of experience.
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Compulsory and Voluntary Deductibles
Compulsory and voluntary deductibles play a huge role in evaluating your premium amount. While the complaint deductible is a fixed percentage of the repair cost you pay during claims, the voluntary deductible is adjustable when you purchase 2-wheeler insurance.
Thus, if you decide to pay a higher voluntary amount, it will decrease your premium amount. However, during claims, your out-of-pocket expense will get higher.
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No Claim Bonus
No Claim Bonus in 2-wheeler insurance is a reward you can get for every claim-free year. Therefore, when you renew two-wheeler insurance, you can get a discount on your insurance premium if you maintain a less claim record.
In fact, as per the guidelines of the Insurance Regulatory and Development Authority of India (IRDAI), this discount can go up to 20%-50%.
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Anti-theft Protection
Installing certified anti-theft devices can help reduce your two-wheeler insurance premiums. This is because these security features lower the risk of theft, making the vehicle less risky to insure. As a result, insurers may offer premium discounts approved by the regulatory authorities.
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Add-on Covers
Most reputable 2-wheeler insurance companies in India offer customisable add-on coverages to enhance the benefits of your standard policy. The policies mainly include all-around roadside assistance, Return to Invoice (RTI), zero depreciation cover, and engine protection.
Therefore, if you opt for these add-ons, you can enhance your two-wheeler’s protection with an extra premium.
Final Word
When you verify the given factors while purchasing a 2-wheeler insurance, you can easily secure the best policy at an affordable rate. However, a higher premium may sometimes offer greater benefits, such as wider coverage, lower deductibles, add-on covers like zero depreciation and roadside assistance, as well as higher claim support.
This is why, instead of going for the cheapest policy, you must compare the coverage benefits to get a wide range of protection during unpredictable events.
Disclaimer: The content on this page is generic and shared only for informational and explanatory purposes. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making any related decisions.
Kathie