Thursday, 23 March 2017

A Face Off: Comprehensive Two-Wheeler Insurance Vs. Third-Party Insurance Policy

For you, your bike is a matter of pride and joy, so it is necessary to secure it with a right two-wheeler insurance policy. When it comes to insuring a vehicle, there are two types of motor insurance policies available in the market— third-party and comprehensive insurance policy.

While, both the policies offer coverage, it is imperative to be clear about the benefits of each of the covers. So, let’s start.

What does third-party insurance mean?

Also, known as the ‘act only’ cover, third-party insurance is a statutory requirement to ply your vehicle on Indian roads. It is known as a third-party insurance because the beneficiary of the policy is other than the policyholder. Though, the policy doesn’t offer any direct benefit to the insured, it offers a third-party legal liability coverage to the policyholder.

What does comprehensive insurance mean?

In addition to covering third-party legal liability, a comprehensive policy covers damages or losses caused to your vehicle from perils, like fire, burglary, storm, etc. It covers you against everything under the sun.

Difference Between Third-Party Two-Wheeler Insurance and Comprehensive Two-Wheeler Insurance 

So why should you choose a comprehensive insurance policy over third-party insurance?

You might be thinking that as third-party insurance policy is cheaper than a comprehensive two-wheeler insurance policy, you should drop the latter. However, before taking a plunge, wait—Do you think your third-party insurance is sufficient to give complete coverage? What if there is a severe accident that causes massive damages to your bike? Who will bear the financial brunt? 

We all are emotionally attached to our vehicle and a single scratch on a ‘beloved’ motorcycle is enough to panic our soul. At this time, you will be disappointed to know that your third-party insurance policy will not help you. 

A third-party insurance policy is sufficient only if the riding conditions are safe. Being mandated by law, it will only keep you safe from traffic police. For the complete coverage, it is necessary to go with a comprehensive bike insurance which will cover both you and third-party, thereby offering financial cushion against any mishap. 

Considering the alarming rise in road accidents in India, having a comprehensive two-wheeler insurance is recommended to cover all types of liabilities and expenses that may arise after an accident or collision.  

Niche riders to expand your coverage

A comprehensive policy offers an end-to-end coverage and ensures less stress for policyholders. Further, it is feasible to expand the cover by opting for the below riders:

  • Engine Protect or Hydrostatic: Many times, insurers refuse to settle the claim because the vehicle was submerged in water. Undoubtedly, the cost of repairing an engine can run in lakhs, and therefore, it is worthwhile to go with this rider which covers expenses associated with engine repairing. 
  • No Claim Bonus (NCB) Protection: A single claim can bring your NCB to zero, therefore, go for an NCB protection which will help you retain your NCB even if a claim is made.
  • Roadside Assistance Cover: Stranded on a road during the wee hours with an immoblised bike? Any unforeseen situation can put a brake to your otherwise smooth bike journey. Go with this rider, which comes handy if your bike breaks down in the middle of a road, there is an accident, your insured vehicle runs out of fuel or any other emergency arises.
Tips to shrink comprehensive bike insurance bill

Ironically, people avoid comprehensive policy to save money, but what they don’t know is that saving a few penny now can prove expensive in the long run when they would have to shell out money from the pocket for repairing their vehicle. So, act judiciously and instead of avoiding comprehensive policy, follow the below tips to cut premium rates:

  • Increase the deductible limit, which is what you will have to pay at the time of claim before the insurance kicks in. However, raise limit only as much as you can afford
  • Though, insurance is meant to secure you, avoid approaching the insurer for fender bender damages. An insurer rewards policyholders with No Claim Bonus (NCB) if they don’t make a claim in a previous policy tenure
  • By installing anti-theft equipments, like central locking system, anti-theft alarm, etc.; you can cut your insurance premium bill. However, these anti-theft equipments must be approved by the Automobile Association of India 
  • Become a member of the Western India Automobile Association to enjoy discounted premium rates
So be a smart buyer and get yourself a comprehensive insurance policy to protect your bike journey from all kinds of perils. Buy two-wheeler insurance because you need it and not just for the heck of it!

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