I was fond of a bike and when I bought my first bike I came to know of the compulsory two-wheeler insurance policy which I had to buy. Apparently, the Motor Vehicles Act, 1988 mandated a valid two-wheeler insurance policy for every two-wheeler driven on the Indian roads. I was not very aware of the technicalities of two-wheeler insurance and bought the plan which my dealer bundled into my two-wheeler deal. On subsequent renewal of the plan, I again bought another policy without paying much attention to it. Later, when I versed myself on the aspects of a two-wheeler insurance policy, I realized I had committed various mistakes in buying the plan blindly.
Here is what I did and what I should have done –
- I did not check the Insured Declared Value (IDV) of the policy
As I later found out, the Insured Declared Value of my two-wheeler insurance plan was my plan’s Sum Insured. It reflected the listed price of my bike after deducting depreciation based on my bike’s age. It is always recommended to choose a higher IDV so that the value of the vehicle remains intact. You can also get a higher claim amount in case of a total loss or theft of your two-wheeler if you have a higher IDV. When I bought the policy I did not check the offered IDV. As it turned out, there were other plans which offered a higher IDV.
What I should have done – I should have compared the available two-wheeler insurance plans and checked the IDV before buying the plan. After comparing I should have chosen the plan which offered the highest IDV.
- I did not opt for essential add-ons
Two-wheeler insurance policies have additional coverage benefits (add-on riders) which enhance the coverage features. Some important add-ons include zero depreciation cover, NCB protect, etc.
Zero Depreciation cover nullifies the effect of depreciation on the two-wheeler’s parts and pays full claim. On the other hand, NCB protect cover which protects the NCB discount even after a claim is made. I did not choose any add-ons and took a simple plan.
What I should have done – I should have opted for a zero depreciation add-on as I had a high-end bike. I could have saved thousands on out-of-pocket expenses in case of a claim when the insurance company deducted depreciation costs from my claim.
- I did not compare the premiums
This was perhaps the worst mistake I could have committed. I did not compare the premiums of different bike insurance plans and ended up paying a higher premium.
What I should have done –-There are dozens of two-wheeler insurance plans available in the market. Each plan charges a different rate of premium. I should have compared the premiums charged by different two-wheeler insurance plans vis-à-vis the IDV they offered. Then I should have chosen a plan with the highest IDV and the lowest premium.
- I did not use my NCB discount
In the first year of my policy I did not make any claim. As such, I was entitled for a No Claim Bonus discount of 20% in my next year’s premium. I did not use this discount to lower my premium and paid the full price.
What I should have done – NCB discount is a very potent feature of a motor insurance policy which helps to reduce the own damage premium. Had I applied my earned NCB to my next year’s two-wheeler insurance policy, I could have saved 20% on my renewal premiums. I didn’t and, thus, paid the price (quite literally!).
I made mistakes when I bought my two-wheeler insurance policy, you should not. There was one major silliness which I committed which resulted in most of the above mistakes. I did not compare. I thought it would be time-consuming. I did not know that the online platform has simplified the whole comparison process. Had I compared between the plans I would have been able to avail the best bike insurance plan. If you do not want to make the mistakes I made you should compare two-wheeler insurance policies before you buy one. Coverfox.com is an online platform which allows you to compare the available two-wheeler insurance plans. You can see their coverage features, choose available add-ons, check the IDV and choose the plan with the best premium rate.
So, choose your two-wheeler insurance plan wisely and avoid making these common mistakes.
