Importance of Bike Insurance for Youngsters

4 min read

Bike Insurance for Youngsters

Today morning I was very excited as I was going to buy my brand new bike. It is sleek, fast and, above all, a style statement. I donned my favorite jeans and t-shirt, took my friend along with me and visited the dealership with an unmistakable swagger in my step. I talked to the sales representative and finalized the deal when I was told about the cost break-up. I knew the cost but the break-up surprised me. What was the premium of a two-wheeler insurance policy doing on my bike’s cost?

Being young, your bike must be the primary adventure on your mind. Why think about insurance when you should be taking out your bike for a spin? However, the Motor Vehicles Act, 1988, mandates a two-wheeler insurance policy. So, like it or not, you have to know about your bike’s insurance policy if you are to drive one.

What does the law say?: The Motor Vehicles Act states that every vehicle, which is to ply on Indian roads, should have a valid third party liability insurance cover.

What is third party liability insurance?: A third party liability insurance policy covers any damages or injuries to the general public or their property. So, when you take your bike for a spin and harm any person or property during the course of your ride, a third party liability cover would come to your rescue. You would be financially liable to pay for the injury or damages caused by you. This financial liability is taken care of by the third party insurance cover.

Is the third party policy sufficient?: Though the law mandates a third party cover only, it is not sufficient. You need a comprehensive cover for your brand new bike. Confused? Let me clarify. While a third party policy covers your financial liability towards third parties, it does not pay for any damages or injuries suffered by your bike or you. You would have to face the cost yourself. Even the pillion rider, facing accidental injuries, would get no financial help from a third party insurance policy. A comprehensive policy is where all these damages are covered. The policy covers third party liability, damages suffered by your bike, accidental death or disability (loss of limbs, eyes or any other permanent disabilities) suffered by you and/or the pillion rider. Thus, the policy provides a wider scope of coverage especially in case of covering pillion riders. In third party policies, the pillion rider cannot claim third party liability in case of any injury. However, in case of a comprehensive policy, the pillion rider can raise a third party claim and get financial compensation for injuries suffered.

What is covered under comprehensive tow-wheeler insurance plans?:

Comprehensive policies cover damages suffered by your bike due to:

  • Third party liability
  • Fire, explosion, lightning, self-ignition, etc.
  • Theft, strikes, collision, etc.
  • Floods, hurricanes, earthquakes or any natural calamity
  • Accidental damages or burglary or theft
  • Personal Accident cover for the owner / driver

Is insurance beneficial?: Haven’t your parents warned you about being careful when riding your bike? They must have. Two-wheeler accidents are very common. In any accident, the police file a FIR in your name and forward it to the Motor Accidents Claim Tribunal (MACT). MACT is a court appointed to hear accident claim cases. The court would assess the injury caused and fix a compensation amount. The same would be intimated to you. If you get involved in an accident, the bare minimum financial liability which you would incur would be at least Rs.5 lakhs. Moreover, if the accidents results in death, the liability is infinite. The numbers are whopping, isn’t it? Would your pocket money be able to cover it?

Furthermore, when it comes to comprehensive policies, the damages suffered by you and your bike is also covered. You must know the huge repair costs incurred in repairing your bike after an accident. These costs are also unaffordable with your pocket money. So, a comprehensive policy helps by taking care of the financial complication of any accident. Also, if you have availed of a loan and your bike is completely damaged, the insurance claim paid for the damaged bike can be used to pay off your loan.

Being a youngster, your bike ride is usually fueled with adrenaline. This adrenaline, though thrilling, might cause serious injuries to you and to others too. Since a bike insurance policy is mandatory, your bike dealer arranges for an insurance policy and the cost is included in the two-wheeler cost. However, you should shop around. Ditch the policy offered by the dealer, compare the other plans available in the market and buy a plan which gives the widest coverage at the lowest possible cost. You cannot avoid a two-wheeler insurance plan but you can definitely make the most out of it if you buy it after comparison.

Choose wisely!

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Gayatri Prabhu, Head-Digital Business at Mahindra Insurance Brokers Limited (MIBL) is one those few digital leaders who has the width and depth that is required to execute an ROI driven holistic digital strategy. She cuts through the noise, identifies the critical levers and leads her team to successful execution of the defined strategy. Her core mantra to win new and retain existing customers is: understand the consumer behavior and craft experiences around it.

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