Multi-Year vs Single Year Bike Insurance Policies


5 min read

There are many ways in which a one-year bike insurance policy differs from a multi-year one with the most obvious difference being in the number of years for which you have the coverage.

The two-wheeler insurance policies are normally meant to provide you with coverage for a year. At the end of the period, you are supposed to renew the policy to extend your coverage. Thus, single-year plans can be regarded as conventional options in these cases. The thing with the multi-year policies is that they are one of a kind. In these plans, you can cover your bike for three years at the least with a single premium paid right at the time you buy the plan.

The thing with multi-year insurance plans is that you do not have to renew them every year. So, these policies provide you with financial security over the long term. As far as the insurance world of India is concerned this is a relatively new addition, which is why it appears to be a perplexing proposition for a lot of riders in the country.

As the owner of a two-wheeler, you must insure the vehicle.

At the same time, you also need the best 2 wheeler insurance for your bike. These two policies are basically the two types of policies that the insurers in India have permission to sell. As the name would indicate, a single-year policy would last only for a year but a multi-year policy would last for a couple of years at the very least. Both these two types of plans have their unique benefits. As such, you should know about them before you make any decision in this regard.

Still, it must be acknowledged over here that multi-year policies have a lot more advantages than single-year policies. The most obvious benefit, in this case, is that with the former you do not have to worry about renewing your bike insurance at the end of each year.

1. The difference in terms of premium  

In a one-year policy, the premium is updated at the end of every year when it is time to renew the policy. Data from the IRDAI (Insurance Regulatory and Development Authority of India) suggests that in these cases the premium increased by 20% each year. On the other hand, in a multi-year policy, the rate remains the same for five years. In such a policy the insurance rates are not affected by any external factor.

This is why when you select a two wheeler insurancepolicy for a longer period there is a good chance that you could save money on premiums.        

2. The difference in terms of NCB (no-claim bonus)

This is an important part of the process of renewing the online insurance of bike. This is basically a discount expressed in terms of percentage and it applies to your Own Damage premium. This is basically a bonus that is offered to riders who have never filed a claim all across the previous coverage period. In the case of a multi-year policy, the NCB discount is much higher than in a single-year policy.

This is because the rate of NCB discounts offered in the multi-year policies are higher than the single-year policies. Keep this in mind when you are trying to buy two wheeler insurance online.

3. The difference in terms of IDV (insurance declared value)

The term IDV stands for the highest value that you get from your insurer if your bike is stolen or damaged completely beyond repair. With bike insurance renewal this value only goes down. In this case, the selling price of your bike in the market, as determined by the manufacturer, acts as the basis. This is set for all bikes irrespective of how long they have been insured for. This also includes the accessories attached to the vehicle.

4. The difference in terms of cancellation  

Understanding this is a crucial part of your two wheeler insurance renewal. Please understand that in the single-year policies you would not get any return if you have a history of making claims. However, in the case of the multi-year policies, you would indeed get some reimbursement which would be based on the part of the policy that is yet to be used.

5. The difference in terms of money you can save 

As you have seen already, the 1 year insurance policy for bike price is in effect much higher than that of a multi-year policy. This is because in the first case you have to renew it at the end of each year, which means an addition of at least 20% on the money you paid in the previous year as a premium. This is according to IRDAI data. On the other hand, the premium rate in a multi-year policy stays the same irrespective of external factors. However, in the case of multi-year policies, you do need to pay a bit more when you are buying the policy.

However, it must also be said over here that the single-year policies are a bit more flexible, at the least, compared to a multi-year one because you can amend them at the end of each year.

Also Read: Why Two-Wheeler Insurance Claims gets Rejected


Most of us who have a bike insurance policy are habituated with the prospect of renewing them at the end of each year of coverage. The insurance regulator in India – IRDAI – though makes it mandatory for new bike owners to have liability coverage that spans at least five years. As you would have seen already, multi-year insurance policies have a lot of advantages compared to their single-year counterparts. They are indeed a bit more expensive but their benefits are much more wide-ranging.

This is the reason why a multi-year bike insurance policy is so prominent. In the end, it can be said that both these types of policies come with their unique benefits as well as traits. So, when you decide which one of these you want to choose it is better to evaluate based on factors such as your present financial condition as well as what you want the most from such a policy.

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Also Read: What is a Two Wheeler Insurance Background Check?

Found this post informational? Browse PayBima Blogs to read interesting posts related to Health Insurance, Car Insurance, Bike Insurance, Term Life Insurance and Investment section. You can visit PayBima to Buy Insurance Online.


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Mar 23, 2022
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PayBima is an Indian insurance aggregator on a mission to make insurance simple for people. PayBima is the Digital arm of the already established and trusted Mahindra Insurance Brokers Ltd., a reputed name in the insurance broking industry with 17 years of experience. PayBima promises you the easy-to-access online platform to buy insurance policies, and also extend their unrelented assistance with all your policy related queries and services.

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