Know more about Two-Wheeler Insurance

What is Two-wheeler insurance?

Two-wheeler insurance plan is a general insurance product that offers protection to the insured two-wheeler and its owner/driver against unfortunate events, including road mishaps, accidents or natural disasters that may require an unforeseen expense for the owner. The coverage is offered to a range of two-wheelers including Motor-cycles, Scooters, Activa, etc.

A two-wheeler insurance policy eases out the financial and legal burden that may arise out of situations involving damages or loss caused to the owner/driver of the insured two-wheeler, the insured vehicle, or any third party or their property.

Importance of Two-wheeler Insurance

As per the Indian Motor Vehicle Act, 1988, it is mandatory for any two-wheeler plying on the Indian roads to have a minimum of third-party vehicle insurance cover. Two-wheeler insurance plans not only provide coverage against third-party liability but also offer comprehensive coverage to the owner/driver of the two-wheeler. These plans cover accidental death or disability of the owner/driver and the cost of repair incurred due to damages caused to the insured two-wheeler.

Types of Two-Wheeler Insurance

Basically, two-wheeler insurance plans are categorized into two types and each of these two types offers a different set of benefits and perks to the policyholders.

  • Third-Party Insurance: Also called liability only insurance, this plan covers the insured and the owner/ driver of the two-wheeler against third party liabilities arising out of an accident, which causes damage or loss to the third party or its property as well as death/disability of the Owner Driver arising out of the Accident. In this type of policy, only third-party damages that are caused by the insured vehicle are covered. Any damage caused to the insured two-wheeler is only covered in a comprehensive plan. It is mandatory to have third-party two-wheeler cover. And all the two-wheelers that are being purchased September 1, 2018 onwards would need 5-year third-party insurance cover.
  • Comprehensive Two-Wheeler Insurance: Also called as package policies, this two-wheeler insurance offers comprehensive coverage to the insured two-wheeler. Apart from third party liability cover, this plan also covers disability or the death of the owner/driver and damage to the insured two-wheeler due to an accident, theft, riots, fire, earthquake, or explosion. There are various add-on benefits like roadside assistance cover, towing assistance, zero depreciation cover, and emergency fuel assistance among others.

Key Factors to Consider before Buying Two-Wheeler Insurance Plans

The sheer multiplicity of two-wheeler insurance service providers and plans in the market can baffle even the most seasoned of investors. Therefore, it makes sense to consider a few vital factors when buying two-wheeler insurance policy.

Here are 4 such factors that one must carefully consider before buying two-wheeler insurance plans in India:

  • Two-wheeler Insurance Coverage: This is one of the major factors you should consider when buying a two-wheeler insurance plan. With two-wheeler insurance you can get a personal accident cover of up to Rs. 15 lakh. It also provides you comprehensive coverage against third-party legal liabilities and own-damages caused to your vehicle. In case of any accidental damage or repair you can avail cashless repair services in the registered garages.
  • Online Services: A two-wheeler insurance plan can easily be purchased online. You can also renew your existing insurance plan on the go without any hassle from anywhere, anytime.
  • Premium: Premium is another key factor that you must consider when buying a two-wheeler insurance plan. It is quite easy to get two-wheeler insurance premium quotes online. You can easily calculate the premium amount using two-wheeler premium online calculator tools.

Two-Wheeler Insurance FAQs

1. Is it compulsory for me to buy insurance for my two-wheeler in India?

Yes, as per the Motor Vehicle Act 1988, it is compulsory to have at least a valid third-party insurance plan when riding a two-wheeler on the Indian roads.

2. What type of coverage is offered under Third-party Insurance?

Third-party insurance plan covers:

  • Legal liability arising out of an accident that causes permanent injury and/or death of a third person from your insured vehicle.
  • Legal liability arising out of an accident from your insured vehicle that causes damage to a third party's property.

3. How much penalty do I need to pay in case my two-wheeler is not insured or my insurance has expired?

Driving without valid insurance (at least third-party insurance) is illegal and this may attract a penalty of up to Rs. 2000 or even jail for 3 months or both.

4. Does a two-wheeler insurance plan cover hospitalization expenses in case of personal accident?

It makes sense that you secure yourself against any possibility of financial obligations that may arise due to a sudden accident. Personal Accident (PA) cover in Comprehensive Two-Wheeler Insurance Policies offers compensation on death/permanent total disability. You may also opt to provide coverage for the pillion passenger.

5. What are the exclusions on the Two-Wheeler Insurance Policy?

Listed below is the list of exclusions on the two-wheeler insurance policy:

  • Normal wear and tear
  • Any accidents or damages to a third party caused due to negligence of the driver
  • Electrical or mechanical failure
  • Accidents or damages caused when the two-wheeler is being driven by the owner/driver under the influence of alcohol/liquor/drugs
  • Depreciation in the value of the insured vehicle
  • Loss or damages caused due to war, or nuclear risks