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Top 10 Factors Affecting Two-wheeler Insurance Premium


Have you ever noticed why two individuals who drive identical automobiles pay different premiums for their insurance coverage? Depending on the choices you opt for, a variety of variables impact how much your insurance plans cost.

You must pay a bike insurance premium to protect your motorbike against any risk of third-party responsibility or own harm resulting from some unanticipated mishaps. The number of two-wheelers on Indian roadways is rising, which has increased street traffic and raised the likelihood of accidents. The Indian government has made purchasing insurance for all bike owners a requirement to mitigate these risks. In this article, let’s discuss what determines the premium amount of bike insurance coverage.

Factors that Impact Two-wheeler Insurance Premium

1. Type of Insurance Coverage

The kind of coverage you choose will have the most influence on the price of your bike insurance. You have two options when choosing a policy: third-party bike insurance, which covers third-party liabilities, or comprehensive coverage, which includes both own damage and third-party responsibility.

You may be aware that the Motors Vehicle Act specifies third-party coverage as the basic minimum need. However, if you decide to upgrade to comprehensive insurance, the slightly increased price will be well worth it. Although third-party insurance will always be less expensive than comprehensive insurance, it will not protect you in the event of theft or personal injury. Furthermore, purchasing long-term bike insurance is usually a better choice since it spares you the headache to renew two-wheeler insurance yearly.

2. Renewal Delay

In the event of unexpected occurrences, a lapse to renew two-wheeler insurance will result in a financial loss. As a result, be sure to set a reminder for finishing the bike insurance renewal procedure. Typically, your insurer will give you 30 days of grace to renew your coverage. You will need to purchase new insurance coverage if you still miss renewing two-wheeler insurance. Given that you could no longer be qualified for a No Claim Bonus, the premium of this new insurance might be greater.

3. Make and Model of the Bike

Since insurance is needed to protect the two-wheeler’s value, the brand and manufacturer of the two-wheeler are the evident elements that determine the insurance rate. If you have a regular two-wheeler, your insurance premium rate will be lower. But you may have to pay a higher premium if you possess a pricey sports bike. The manufacture and model of your bike are crucial in determining the price since two-wheeler insurance is designed to compensate for the depreciation of the vehicle.

4. Cubic Capacity of Engine

The engine’s capacity is measured in cubic capacity (cc), and the premium cost is directly proportionate to the engine’s capacity. You may get a low-cost insurance premium if your bike’s engine is less than 75cc in cubic size. An automobile with more than 350cc engine size will, however, get a higher premium rate.

5. Age of Bike

The age of your bike also plays a determining role in your insurance coverage cost. The market worth of a bicycle decreases with age. Now, you may think that this will reduce the premium rate, but that does not happen. Your two-wheeler will cost extra to insure because of its growing age and greater susceptibility to damage. As a result, before approving your insurance coverage, the insurance company will analyze and inspect your two-wheeler.

6. Insured Declared Value (IDV)

The insured declared value, which is the most you may get when submitting a claim, is a crucial part of your extensive bike insurance. The insurer will pay out the IDV to make up for the loss in the case of total damage or theft. When purchasing insurance, the estimated IDV of your motorcycle is determined depending on the make, model, and year of your two-wheeler. Its basic definition is the vehicle’s current market value less the depreciation factor. As a result, the premium is larger if the IDV is higher.

7. Add-on Cover

With add-on covers, you may expand the scope of your two-wheeler insurance coverage. However, in addition to the premium quotation, some covers have extra costs. So, the total premium cost will increase as you buy additional add-ons. Only choose add-on covers that satisfy your insurance needs to prevent paying for an expensive insurance plan. So, use caution and limit your cover collection to what is required.

8. Modifications and Anti-Theft Security Features

By putting in anti-theft equipment authorized by the Automotive Research Association of India, you may benefit from a decreased premium amount. Your premium will be relatively less for a bike with such safety features since the security features assure a lesser likelihood of vehicle theft. Therefore, adopting such anti-theft measures is highly advised.

Every time you alter or add extras to your bike to enhance its appearance or performance, you are making a compromise. The price of the insurance policy may rise as a result of such a revision. It is thus advisable to notify the insurance company in advance and to fully understand how the changes will impact the premium amount before proceeding.

9. Voluntary Deductible

The voluntary deductible is the sum you consent to pay out if you file any claims. You may get a cheaper premium quotation if you agree to pay a greater deductible sum. You should, however, only consent to pay the deductible that you can manage. Selecting a bigger amount might be fatal if you can’t pay for it during the claim settlement.

10. No Claim Bonus (NCB)

If you go a whole year without filing a claim, you might get a reduction in your rate when you renew two-wheeler insurance. Beginning at 20%, the bonus increases to 50% for years that pass without a claim. You may take your NCB award with you if you are changing insurance companies or upgrading to the newest bike model. As a result, if you have accrued a No Claim Bonus throughout the years, you may be able to get a cheaper premium quotation.

When choosing motorcycle insurance coverage, keep in mind the above factors. It will be simple for you to choose the appropriate insurance premium for your bike if you are aware of these aspects. All that’s left to do is compare several insurance quotations and choose the one that best suits your requirements. It will provide you with cheap insurance coverage, which will aid in keeping your bike secure. While the aforementioned variables may influence the cost of your bike insurance policy, it is important to remember that you may lower your insurance prices. You may, for instance, install anti-theft devices, refrain from filing claims until required, and purchase just the necessary add-on riders.

Disclaimer: The above information is for illustrative purposes only. For more details, please refer to policy wordings and prospectus before concluding the sales.

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