Know the different types of Two-Wheeler Insurance

Author: Radhika Adsule

The Motor Vehicles Act, 1988 governs Motor Insurance in India, while the Insurance Regulatory Development Authority of India (IRDAI) regulates insurance companies and their policies. Two-Wheeler Insurance is a type that falls under the umbrella of General Insurance.

These companies offer Third-Party Liability Insurance as well for new owners under the Motor Vehicle Act mandate. Motorcycles operating on country roads without a valid policy are subject to severe penalties. Hence, every bike owner must carry at least Third-Party Insurance, the minimum coverage for bikes.

There are two types of Motorcycle Insurance policies:

  • Third-Party Liability
  • Comprehensive Policy

Third-Party Liability Policy

Because the policy's beneficiary is someone other than the insurer and the insured, it is named Third-Party Liability. It is important to remember that this insurance does not provide any compensation to the insured. It instead covers the insured person's legal obligation for death or disability caused to a third-party. It also covers any loss or damage done by the insured motorbike to the third-party asset.

  • From September 2018, the Sum Insured for Third-Party Cover increased to Rs. 15 lakh for all bikes. Previously, the maximum sum insured for two-wheelers was only Rs. 1 lakh.
  • If a person owns more than one bike, they pay for only one Personal Accident Cover. This premium pays for compensation if one of the rider's insured vehicles gets involved in an accident that results in the rider's death or permanent disability.
  • For new
Two Wheeler Insurance Plans, Third-Party Liability Insurance is necessary. Personal Accident Coverage for owner-drivers, meanwhile, is for one or more years.

Buying Third-Party Two-Wheeler Insurance is simple and requires minimal documentation. However, it is also true that a Third-Party Liability Policy only covers third-party injuries or death, along with bike damage. This insurance, however, does not protect you during accidents. It is best if you bought a Comprehensive Motorcycle Insurance Plan for the same.

Comprehensive Insurance Policy

The bike and the insured get covered entirely under Comprehensive Insurance. This includes both third-party liability and your injuries besides damage or theft. Some insurance firms also offer different add-ons and optional coverages, such as Zero Depreciation that covers even the cost of consumables.

The motorcycle receives protection against theft, loss, and damage under comprehensive coverage. Under an accident, it offers Personal Accident Cover for the owner or rider. Furthermore, such Two-Wheeler Insurance protects from accidents.

Comprehensive insurance for bikes is bought annually. However, to avoid the hassle of annual renewal, opt for a long-term Bike Policy.