What Are the Components That Contribute to Your Bike Insurance Premiums?

Insurance Premiums


When you are shopping for a new two-wheeler, you might have come across registration and insurance as two main requirements when buying one. While the registration is taken care by the motor dealer, insurance is something you have an option of. Dealers generally offer a couple of insurance plans, but that may not always be adequate based on every buyer’s requirements. Hence, it is advisable to look for a policy that checks all the right boxes while having a pocket-friendly price tag.

Premium is the price that you require to obtain insurance coverage for your bike. There are many factors that impact the bike insurance price however, many cost-conscious buyers place extensive weightage on the premium.

Since premium is a crucial factor for most buyers, it is important to know which of these elements have a direct impact on the premium amount. This article aims to answer this question to simplify your bike insurance purchase.

*Type of insurance policy

The primary factor that impacts the bike insurance price is the type of insurance coverage. Bike insurance plans are available in two types—third-party plans and comprehensive covers. As a bike owner, you need to have any one of the two policies to ensure legal compliance to the Motor Vehicles Act of 1988. Although, a third-party insurance coverage is the bare minimum requirement.

A third-party policy provides protection from legal liabilities that may arise due to an accident or collision injuring a third person or causing damage to their property. As mentioned, a third-party policy is the bare minimum insurance cover that all bike owners must buy, its premiums are regulated by the insurance regulatory body, IRDAI.

Contrary to third-party plans, comprehensive policies offer a broader coverage protecting against not just third-party liabilities, but also own damages to your vehicle. Comprehensive plans comprise of two parts—third-party covers and own damage cover wherein the premium for third-party cover is determined by IRDAI, and the premium for own-damage cover is set by the insurance company. You can visit the official website of IRDAI for further details.

*Insured declared value of your bike

IDV or insured declare value is another factor that has a significant impact on the insurance premiums. It is maximum amount which the insurance company pays in the event of total loss or damages to your bike beyond repair. Since it is a risk that the insurance company must undertake, it has a direct bearing on the premium amount. Moreover, comprehensive plans allow the policyholder to adjust the IDV within a specified range and hence impact the premium accordingly. A two wheeler insurance premium calculator is handy tool that can help you estimate the impact of either increasing or decreasing the IDV.

*Add-on covers

Add-ons are optional yet addition insurance covers that can be bought with a comprehensive plan or a standalone own-damage cover. Since they are over and above the standard policy coverage, they have an additional cost and thus impact the premium amount.

*Location of registration

The location where your vehicle is registered plays a significant role in determining its insurance premium. Two-wheeler insurance premiums are classified in two zones—Zone A which includes eight metro cities of Kolkata, Chennai, New Delhi, Mumbai, Bengaluru, Hyderabad, Pune and Ahmedabad while Zone B covering rest of India.

* Standard T&C Apply

These are some of the important elements that impact the premium at bike insurance renewal and purchase.Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms and conditions, please read sales brochure/policy wording carefully before concluding a sale.


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