Bike Insurance Add-Ons
You own a bike and got a comprehensive policy for it. You might be wondering if the comprehensive policy is sufficient to protect the bike in all possible situations or not! The genuine answer is: Comprehensive policy is not enough! As monsoon will be hitting soon, let’s discuss a bog-standard situation – bikes and cars rushing into a waterlogged road in the hope to cross it in a hurry and eventually stopping due to engine seizure. What will you do in the same situation? Your attempt to restart the bike will only cause more damage to the engine! This certainly will cost huge to repair, so you will file a claim. In this case, the insurance company will reject this claim as it is consequential damage! Surprised? A comprehensive policy does not cover damage to the engine caused by the driver’s negligence, you need to take Engine & Gearbox Protection add-on for better protection.
Your two-wheeler gives you a sense of freedom; hence it is your responsibility to keep it safe in every possible way. The best you can do is get its service regularly whenever due as it will give your bike a longer life. Another must-do thing for you is to buy a bike insurance policy. Yes, you read it right. A bike insurance policy will keep you and your bike protected if there occurs any unexpected incident that can cause damage to your bike or you.
Thinking how? Let us see.
What is Bike Insurance?
A bike insurance policy will cover you against damages that arise due to accidents, fire, natural disasters, and theft. When you think of loss, these are not limited, right? You may accidentally injure a third party from your bike. Any blow to the human or the property can bring an unimaginable amount of liability on you. If you own a comprehensive bike insurance policy, your damage and third-party losses will be covered.
Types of Bike Insurance Policies
In India, these are the types of Bike Insurance Policy you can think of buying:
1. Third-Party Bike Insurance Policy
Depending on the massive number of hit-and-run third party cases, the Government of India made the third party bike insurance policy mandatory by law. This type of policy protects your expenses when you happen to damage someone else’s property or cause bodily injury to someone with your bike. Driving without a third-party policy is considered a legal offense as per the Motor Vehicles Act, which attracts a penalty of Rs.2000/-. The premium under this type of policy is decided by the government and depends on the cubic capacity of the bike.
2. Comprehensive Bike Insurance Policy
It is a package policy that pays you when there is bike damage, injury, and third-party liability. You must consider buying a package policy for the maximum cover.
3. Standalone Own-Damage Insurance Policy
This is not a compulsory cover. If you happen to take a long-term third-party insurance policy, you can buy a standalone own-damage cover. Choose if there is a need or if you think that cost of repairs/damages is beyond your absorption capacity. Take note that if you already own a TP policy from one insurer then you can choose to buy this one from the same insurer or a different one.
For your bike, you get options to buy any of the three covers. The type of motor policy you should buy depends on the age of the vehicle, usage, limit of protection needed, and other factors. Comprehensive Bike Insurance Policy is the largest cover you can choose.
FAQs- Bike Insurance
1. Is comprehensive policy enough to cover everything?
Deciding which cover to pick for your bike is completely your call. Always consider the benefits of the cover before buying the policy. Comprehensive cover will pay you for your own damage, third-party liability, and personal accident.
The own damage losses may arise due to :
- theft, and
- natural disasters.
Under a third-party liability section, you protect your savings. You may incur a loss for:
- Bodily injuries.
- Property Damages up to Rs.7.5 lakhs.
- Disability (Permanent or Temporary)
Apart from these two sections, the bike insurance policy will pay you for personal accident cover also. The owner of the bike stands covered. Leaving aside all of these, your bike will not be protected for depreciation, roadside assistance, total-loss, consumable damages, and engine and gearbox-related damages. This is why the comprehensive package policy is not sufficient. These additional covers can be bought only by paying an extra premium.
2. What are add-on covers, and how much does it cost?
Add-on or the additional covers to put in simple language are the offerings from the insurer to make your comprehensive policy wider than it is. But yes, this extended coverage applies only after when you pay an extra premium. You need to smartly choose the add-ons to avail of fair insurance premiums.
Widely available add-ons/ riders are.
Zero Depreciation Cover
After an accident, the insurance company will settle the claim only after applying the depreciation. It is the amount that the policyholder has to bear from their pocket (other than what the insurer pays) to get the repairs done.
Understand it with an example of Bajaj Pulsar 180 HF bike 2019 model cost of which was more than Rs.1 lakh. The IDV of the bike for renewal in 2021 was Rs. 75,523 after depreciation. The bike met with an accident, and the cost of repairs was Rs.20,000/-, but the insurance company will pay you Rs.17000/- only. The remaining amount was the depreciation applied, which the insured will have to pay.
Without a Zero Depreciation cover, the company would pay Rs.17000/-. On the contrary, with the add-on of Zero Dep, you would receive the cost of repair/replacement as it is.
The above is the value of depreciation applicable as the bike ages. The Zero-dep add-on will throw this calculation out of the window during the claim settlement process.
The add-on cover is available at an affordable premium of Rs.750 approx.
In a recent survey in India, the data shows that out of 10 stolen bikes, nearly 8 are never recovered. Vehicle theft has grown at a rapid pace in our country. This is considered the case of a total loss. Can you imagine this happening with you? No, obviously!
At times you cannot avoid any loss that is beyond repair. Such losses may arise either due to theft or total damage. This could be the worst thing ever. But imagine if you could get the amount of bike as a claim compensation, nothing would be better, right!
Suppose you bought a Bajaj Pulsar 180 HF bike worth Rs.1,07,000/- in 2019. 2 years after when it was parked outside the restaurant, a speeding truck hit and then drove over your bike. With the blink of an eye, your two-wheeler was smashed and crushed to nothing. The truck driver fled, and you had no clue who he was. This kind of loss would be covered under your bike insurance policy only up to the limit of IDV i.e, Rs.75,500 approx. After the loss, you will be paid an amount maximum up to this value only. But with the Return-to-Invoice cover add-on, you can get a claim payment of Rs.1,07,000 (approx)/-. The cost of the premium for this add-on will be Rs.189 only. With this add-on, you can buy a brand new version of the bike that you lost.
Engine and Gearbox Protection Cover
Think that you own a Hero Honda Xtreme Bike worth Rs.79,000/-. In a road accident, the front part of the bike was misaligned. The cost of repair for the front was Rs.15,000. The insurance company will pay you the claim amount considering the depreciation.
Now, a few days after the engine of the bike broke down because of leakage of lubricating oil. The cost to fix the engine was Rs.31,600/-. You will not be able to claim this amount because damage to the engine is covered only if it arises during an accident. This is where buying additional cover of Engine and Gearbox Protection plays the role.
It explains that buying additional covers along with the package policy suffice the complete security purpose. The premium amount for this add-on will be less than Rs.100/-. Imagine for such a low amount, you get protection for your precious bike.
In a few years, there might be a need to replace the engine oil. The loss may arise due to an accident. Say, the cost to replace or refill the engine oil would be Rs.2000/-. In case you do not have this additional cover, you will have to bear the expense. But with this add-on, the insurance company will reimburse the amount.
For consumables cover, you might have to pay an extra premium of less than Rs.100/-. This will pay you for replacing the consumables of your bike like engine oil, brake oil, lubricants, fuel filters, nut & bolts, etc.
What if, on your way uphill, your Bajaj Pulsar 180 HF BS-6 bike stops suddenly. It needs lift-up and quick repair. In a normal situation, you will have to bear all the expenses for a fix. But if you have paid for this add-on, your insurance company will arrange for both your as well as the bike’s pick-up. Such useful cover you can get at a price as low as Rs.50/-. So with this add-on, you are never stuck anywhere; your insurer will always have your back.
Depending on the utility, choose the add-on cover for your bike. Remember to get these added at the time of renewal because you cannot add these in the mid-term.