What is a Two Wheeler Insurance Background Check?

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4 min read

Updated on Jul 13, 2022

Do you want to know about the process of how background checks are done for bike insurances in India? Read on to know how the process operates.

In India driving a vehicle without the hassle of law breaking is possible only when you have some valid documents including vehicle insurance. The government enforces a third-party insurance cover to every individual owning a vehicle. The insurance services are monetary services and thus insurers are vulnerable to incidents of cheating and fraud. Hence, insurance providers need to keep a check of the insured in advance to know everything about the person before offering or issuing insurance coverage to the person.

Also, insurance companies try to constantly stay informed about the individuals that they are providing coverage so that they can further improve on their offers. Hence, most insurance providers keep conducting background check on their clients frequently.

In this blog, we will discuss the meaning of insurance background checks, the process of insurance background checks that insurers use, and also understand the requirements of such background checks.

So, What Do You Mean By A Two Wheeler Insurance Background Check?

Insurance background check is a process that insurers use to get information about the insured person whom they are offering the insurance coverage to. This way, the insurer wants to limit the fraud and cheating cases that take place in the insurance sector as well as they can ensure better services to their clients.

The background checking is done in case of all auto insurances that you buy offline or online. Getting a two wheeler insurance online makes it easy for the insured to procure the policy after comparing well.

Let us now discuss the reasons why a Bike Insurance Background Check is required.

Why Bike Insurance Background Checks are Carried Out?

The most common reasons are mentioned below:

  • The first and foremost thing that insurers want to ensure is the identity of the policyholder. This way they want to confirm that the owner of the policy is the same person that he/she has portrayed and thus ensure that the company is selling insurance to genuine persons.
  • Background checks also make sure that the insurance company stays protected against fraud claims. There are many cases where insurers receive fraudulent claims for third-party insurances from corrupt or fraud people.
  • The next reason for background check is to ensure that the policyholder is not a victim of identity theft. There are many incidents where frauds have used phone insurance tricks to cheat susceptible two-wheeler owners of money and personal identity.
  • Another reason why insurance providers need to get background checks done is to make sure that the premiums of the bike insurance can be fixed as per the driving habit of the insured. This is because insurance companies do not charge an equal premium to people who file claims regularly as compared to the one who make occasional claims. Thus, with background checks it is possible to avoid such incidents.
  • Last but not the least, insurance providers must also ensure to follow anti-money laundering policy on domestic and international level. This means that the insurers should go through detailed checks on the background of the policyholders to restrict money laundering issues.

Why Bike Insurance Background Checks are Carried Out?

Most two-wheeler insurance companies offering third-party, comprehensive, or own damage insurance coverage carry out a series of investigations for background checks. Some of them are mentioned below:

1. Details About the Insured

Bike Insurance companies use the individual information about the insurance policyholders to confirm the identity of the individuals who are filing the claims. This is also ensured for people who sign up to buy new two-wheeler insurance plans. This background check is done to make sure that the insurance companies adhere to the guidelines of KYC. Further, it aids in detecting identity theft as well as preventing frauds.

2. Reports of Credit Score 

The credit report of an insured person can also be used to indicate the financial wellbeing of the person and their spending habits. There are a large number of companies who offer credit scores that are used by financial institutions like two-wheeler insurance companies to check credit history of insurance policyholders.

3. Past Offenses 

Further, insurance providers also take a look at the past fraud cases or any other offense done by the individuals buying the insurance or raising a claim to ensure that the person is not a fraud. Tricksters generally target insurance firms like other financial companies. So, by means of criminal background check, the insurers verify not to expose their firm to frauds.

4. Driving History 

Another important thing that bike insurance companies evaluate is the driving history of the people seeking insurance. This they carry on by assessing the history of the insured person in terms of his/her driving skills or if they were involved in any accidents, mishaps etc. in the past.

To Conclude

Though two-wheeler insurance companies undergo background checks of the insurance policyholders. But that doesn’t mean that they do not respect their privacy. They ensure complete privacy of the insured persons and use the personal information of the policyholders only for insurance specific purposes. Insurance companies follow strict policies of privacy security of the insurance policy holders and thus the policy holders are not likely to be concerned about their background check done by the insurer.

Also Read: Common Mistakes to Avoid When Renewing Your bike Insurance Policy Online

You can avail two-wheeler insurance for your vehicle via offline means or you can get bike insurance online from any reputable insurer. Also, it is important to ensure that you carry out bike insurance renewal on time every year so that you stay protected under the coverage of bike insurance. This way, you can process your claim whenever you need coverage to incur damages caused by an accident or any mishap.

Mar 23, 2022
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PayBima Team
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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