Two-wheelers are the most common vehicles on Indian roads because they provide a flexible commuting option in the notorious Indian traffic. However, riding a two-wheeler exposes riders more than cars do, increasing the risks on the road.
A two-wheeler insurance is much needed in such a situation to safeguard riders from unforeseen mishaps. To ensure that every bike owner gets their vehicle insured, having at least a third-party bike insurance has been mandated by the Motor Vehicles Act 1988.
Read on to learn why bike insurance is mandatory in India, how it protects the owner, and what it covers!
Top Reasons Why Bike Insurance is Mandatory in India
Take a look at the reasons why the bike insurance law in India has made it mandatory for every two-wheeler to get insured:
- Financial Security
Despite their ease and numerous benefits, bikes come with an increased risk of unforeseen accidents, damaging the vehicle or injuring the rider or pillion rider. Whether the damage is to their own bike or to someone else’s, the bike owner must compensate for the loss by bearing the expenses. Bike insurance plays a crucial role in such scenarios by providing you with the much-needed financial backup.
- Legal Requirement
The Motor Vehicles Act of 1988 has declared that having a bike insurance policy is compulsory for every two-wheeler owner in India. If any bike owner is found riding on roads without a valid insurance policy, they will be liable to pay a hefty penalty.
● Protection Against Accidental Risks
Accident risks may increase due to poor road conditions and rash driving. This can lead to vehicle damage and even life loss. Bike insurance covers the expenses of vehicle repairs and accidental death, offering protection against accidental risks.
How Does Bike Insurance Protect the Vehicle Owner?
Bike insurance offers protection to the owners and their vehicles in the following ways:
● Legal Liabilities
You are liable to pay for the damages caused by your vehicle to a third-party property, vehicle, or individual during an accident. It is a legal requirement, and any violation of this act can lead to penalties and even imprisonment.
Here comes the role of bike insurance as a reliable protection against unforeseen expenses. Your insurance coverage will compensate for these damages on your behalf. If you don’t have insurance coverage, you will have to pay the expenses on your own.
Apart from that, authorities will impose a penalty on you for not abiding by the legal requirement for bike insurance.
● Financial Expenses
As per experts, buying comprehensive bike insurance is essential, as it offers own-damage or OD bike insurance, which is mandatory to protect you financially. It offers extensive coverage to your vehicle against accidental damage, vandalism, theft, natural or man-made disaster, etc.
Moreover, comprehensive policy offers add-on covers to enhance your security across various fields. Owners of expensive bikes can benefit significantly from this policy, as the repairs and replacement costs of these vehicles can burn a hole in your pocket.
What does Bike Insurance Cover?
As already mentioned, bike insurance policies are essentially of two types: third-party insurance and comprehensive insurance. Coverage offered by each type of bike insurance policy is explained below:
Third-party or Liability-only Bike Insurance Policy
Here’s what a third-party insurance covers:
● Legal Coverage
Third-party insurance is a legal requirement as mandated by the Motor Vehicles Act, 1988. It helps cover the third-party liabilities caused by your vehicle in an accident. It does not offer any own-damage coverage to the insured bike.
Comprehensive Bike Insurance Policy
A comprehensive policy offers third-party coverage along with own damage coverage, which includes:
● Damages or Losses Caused by Natural Disaster
In India, natural disasters are a common occurrence, which can cause severe damage to your vehicle. This includes cyclones, earthquakes, flash floods, fire, etc. If any of these natural hazards damage your two-wheeler, a comprehensive insurance policy will cover the repair expenses.
● Loss Due to Bike Theft
Bike theft is a common nuisance in urban as well as rural areas. In case of such unfortunate events, you can claim IDV in bike insurance. Insured Declared Value (IDV) is the maximum amount that your insurer will provide you as your bike’s value in case of theft or irreparable damage.
● Damages or Losses Caused by Man-made Calamity
Other than natural disasters, there are certain man-made calamities like large-scale riots which can damage the infrastructure of a city. In case your two-wheeler is stuck in such man-made calamities and gets damaged, you can claim your insurance coverage.
Comprehensive Insurance Add-ons
Policyholders can extend their bike insurance coverage by purchasing add-ons with a comprehensive policy. You can avail yourself of these benefits by paying a little extra with your monthly insurance premium. Policyholders can buy more than one add-on based on their needs and budget.
Here are some of the add-ons available with a comprehensive bike insurance policy:
- Zero Depreciation
If you buy this add-on, the depreciation value of your bike will not be calculated, and you can claim the full value of your vehicle’s repair and replacement costs.
- Tyre Protect
Bikes with run-flat tyres are only eligible for the tyre protect add-on cover. It covers the cost of replacing damaged tyres with ones that are nearly identical to the original. Wheel balancing expenses and labour costs for tyre removal and installation are also covered.
- Breakdown Assistance
Under this add-on, you can ask for immediate roadside assistance during sudden breakdowns without even making an insurance claim. This is beneficial for bike owners who travel frequently.
- Consumable Cover
With this add-on, you can get coverage for all the nitty-gritties of your bike, such as screws, bolts, nuts, engine oil, grease, etc., that have been damaged or lost during an accident.
- Return to Invoice Cover
If your bike is stolen or damaged beyond repair, the return to invoice add-on is very useful. It covers the cost of replacing your bike with the same or a similar model, including road tax and registration charges.
Thus, bike insurance offers potential financial support to cover the damages caused to your two-wheeler, as well as third parties in an accident. It is a mandatory requirement, as per the Motor Vehicles Act of 1988, to ensure that every vehicle is protected from unforeseen mishaps. If you are planning to buy a bike or have already purchased one, make sure that you always have a valid insurance plan.
Timely paying the premium and having the right add-ons will help keep legal hassles and unexpected costs at bay.
