Two-wheeler insurance is imperative for the financial safety of the rider. Generally, auto dealers and brokers provide two wheeler insurance cover on the purchase of bikes. Post that, it’s the owner’s duty to renew two-wheeler insurance. Statistics show that two-thirds of the old two-wheelers on road are not insured. To cope with these non-renewals, the Insurance Regulatory and Development Authority of India (IRDA) has come up with a long-term two-wheeler insurance policy that is active for five years. This policy provides the mandatory third-party legal liability coverage. The policy handles all legal liabilities in case of fatal accidents that may have caused permanent injury or loss of life to any third party. So, the best option is to opt for renewing two-wheeler online.
Besides, you can buy a comprehensive policy and extend the coverage as per the following in for long-term insurance:
- Protection against any damage that occurs to your vehicle in case of any unexpected events like theft, strike, riot, malicious acts, terrorist attacks, etc.
- Protection against any loss or damage that occurs to your vehicle in case of natural disasters like fire, earthquake, storm, flood, etc.
- Financial aid is given to riders in case of bike accidents
Long-term bike insurance offers the benefit of lower premium costs and savings against the yearly third-party premium hike. Let us study the various advantages offered by this policy in detail:
- No worry to renew two wheeler insurance annually: Long-term two-wheeler insurance frees you from worrying about the renewal of the policy every year. You are free from the tension for 5 consecutive years.
- Avoid non-renewal related risks: In the case of annual insurance, you may forget the renewal date and this may cause a delay in the renewal process. During the non-renewal period, if the vehicle gets stolen or undergoes any damage due to the accident, the owner will have to bear the financial loss himself/herself. The same can be escaped for 5 years if one goes for the long-term plan.
- Avoid problems of renewing a lapsed policy: Some insurance companies, in case of policy lapse, demand inspection of the vehicle prior to its renewal. This situation is avoidable if you opt to renew your two wheeler insurance online for the longer term.
- Discount on own damage premium: In long-term policies, the insurers reduce administrative and policy-issuing cost which is passed on as a discount to the customers. This discount varies from company to company based on factors like the manufacturer of the two-wheeler, the model, RTO under which the vehicle is registered, etc.
- The premium rate is frozen for three years: Long-term cover insulates the insured party from an annual hike in third party premium rates.
- No Claim Bonus (NCB) advantage: NCB discount is greater in long-term policy compared to the annual one. Previous NCB discount earned is added to your new long-term two-wheeler insurance plan.
- NCB benefit after claim: NCB is not lost completely in case of any claims during long-term policy, unlike the regular annual two-wheeler insurance plan.
- 24*7 Call Assistance: Two-wheeler insurance online policy provides you with round the clock services for any claim support and policy related queries.
- Mid-term cancellation refund: For yearly two-wheeler insurance, no or minimal refund is provided in case of any claims. However, long-term policies provide a proportional refund for uninitiated policy years, even if a claim has been made in the policy period.
- Premium refund in case of termination: Single year and long-term policies do not permit termination of the policy post payment of the claim amount. Termination is possible only in case of total loss/theft. Long-term insurance plan refunds a certain portion of the premium for unexpired years in case of total loss/theft, unlike annual ones.
The only flipside of long-term two wheeler insurance plan is that you may get stuck with a higher rate, even if the market premiums go down in the future. However, a look at the current regulations clearly suggests that long-term two wheeler insurance plans have become mandatory, at least for third-party coverage. Coupled with the benefits available, the mandate is definitely for the best.
Kidal Delonix is a contributor to Mr. Hoffman's blog. The views and opinions are entirely his/her own and may not reflect Mr Hoffman's views.
