All bike owners are aware of two-wheeler insurance as compulsory requirement. It is essential to purchase a bike insurance policy for two reasons – one as a safeguard for all damages and liabilities and second as legal compliance as per the Motor Vehicles Act.
When it comes to selecting abike insurance plan, there are two alternatives, a third-party policy or a comprehensive insurance plan. This article highlights the differences between these bike insurance policies.
#1 Legal requirement
Third-party bike insurance policy is the bare minimum insurance policy that you need to buy thereby making it a legal requirement. On the other hand, comprehensive policy is not mandatory by the law. It is an optional upgrade to a third-party policy.
#2 How does it work?
A third-party bike insurance policy protects against financial liabilities that may arise due to an accident. A comprehensive policy on the other hand offers financial support for third-party as well as own damages.
#3 Coverage of the policy
The coverage under a thirdparty bike insurance policy covers the injuries to another person along with damage to their property. It is limited to provide compensation for accident related injuries to third person and damage to their property up to ₹7.5 lakhs. The same under a comprehensive policy isoffered for own damages which may be due to natural calamities, man made events, theft, vandalism, fire and more along with third-party coverage.
#4 Exclusions under the policy
Third-party policies do not cover the damage to your bike, personal accident cover, any damages when riding with appropriate vehicle documents, driving under the influence of intoxicating substance and when the policy coverage has ended. Similarly, for comprehensive policies, the exclusions include any mechanical or electrical damage, damages due to routine wear and tear, not have the right documents when riding your bike, driving after consumption of intoxicating substances, and with an expired policy.
Add-ons are optional covers that can be purchased to increase your policy scope. A third-party policy does not offer add-ons whereas the same are available under comprehensive coverage. Since there are a variety of add-ons that can be bought, it can be helpful to customise your policy coverage. Depending on your riding conditions, your locality, it can help to select suitable add-ons among the many.
As discussed above, a third-party policy is minimum requirement and thus priced at an affordable level whereas the pricing of a comprehensive plan is higher since it offers a broader coverage along with customisation using add-ons.
A third-party policy is suitable for someone who does not use their bike much which lowers the risk of accidents and damages. For someone using their bike extensively or has purchased a new bike, a comprehensive policy is advisable since it offers coverage for variety of events.
Now that you know the differences, make a smart choice based on your requirements. While it common for most buyers to solely base their purchase on premium, but there are many factors to decide upon. At such times, a two wheeler insurance premium calculator can come handy. With this calculator, you can base your purchase considering all essential features along with its impact on your premium. 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.