Factors affecting the cost of third party bike insurance 36720 - Factors affecting the cost of third party bike insurance?

Factors affecting the cost of third party bike insurance?

A third party bike insurance plan is one of the fundamental two-wheeler insurance coverage crafted to safeguard policyholders financially against all third party liabilities resulting from a mishap or accident. Moreover, having this insurance cover is legal compliance as per the Indian Motor Vehicles Act of 1988.

Thus, before purchasing an insurance policy like this, a policyholder should learn the factors that affect this decision.

Factors that affect the cost of third party motorcycle insurance policy

Unlike a comprehensive bike cover, a third party bike insurance plan features a lower premium amount, which is decided by the following factors:

1.   Vehicle’s engine capacity

A third party motorcycle insurance’s cost or premium amount is decided by considering the insured vehicle’s engine capacity. Specifically, the Insurance Regulatory and Development Authority of India (IRDA) has set forth the applicable premium rates for conditions relating to the engine capacity of two-wheelers as –

  • Up to 75 cc – Rs.538
  • 75 cc – 150 cc – Rs.714
  • 150 cc- 350 cc – Rs.1366
  • More than 350 cc – Rs.2804
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However, these two wheeler insurance rates might change as per further announcements by the IRDA.

2.   Add-on covers

Insurance companies provide a host of add-on services to enhance the nature and scope of protection on comprehensive bike insurance policies. Insurance providers extend facilities like personal accident cover, roadside assistance cover, etc., as a part of their add-on coverage portfolio. Adding these facilities will, in turn, increase the total insurance premium amount as well.

Reasons to purchase a third party bike insurance plan

Here are a few reasons explaining why one should buy a two-wheeler third party insurance plan –

●     Financial assistance coupled with legal coverage

In addition to protection against a third party’s death/injury or property damage, policyholders also get coverage for any financial or legal hassles arising because of injury to a third party.

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●     Budget-friendly insurance plan

A third party bike insurance policy extends maximum coverage benefits at a minimal cost. Insurance companies cannot alter the premium rates as they are fixed by IRDAI. This makes the cost of availing of this insurance plan affordable.

●     Waives off penalty

As per the Motor Vehicle Act, every two-wheeler must be insured with a third party insurance plan upon purchase. Failing to comply with this rule can attract heavy penalties. Thus, the minimum requirement of a third party two-wheeler insurance plan saves policyholders from fines and penalties.

Things covered under a third party bike insurance

Here are few inclusions under third party two-wheeler insurance plan:

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1.   Death or injuries to a third party

In case of a mishap, the coverage under a third party bike insurance policy can support the medical expenses or loss of income due to death or disability of the third party.

2.   Property damage cover

If an individual’s bike causes damage to a third party property, this insurance plan could pay the expenses incurred.

3.   Total or permanent disability of the owner

If the vehicle owner suffered permanent or total disability due to an unfortunate event, the third party bike insurance would compensate him/her for the loss.

Things not covered under a third party bike insurance

Here are a few exclusions under third party bike insurance plan:

  1. Damage or loss due to speeding
  2. Loss or damage under the influence of alcohol or any other drugs
  3. Damage caused outside the stated geographical region
  4. Loss or damage by underage or unauthorised driver
  5. Electrical or mechanical failure in a bike
  6. Damage, liability or loss due to riots, nuclear weapons or war
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Therefore, individuals looking for a third party or comprehensive bike insurance policy can route their purchase through leading aggregators online. Here they will get an opportunity to compare and find a suitable policy from a wide range of options from various insurance companies.

A third party bike insurance extends coverage benefits in exchange for a small investment. However, policyholders must know all the inclusions and exclusions before availing one and strive to comply with the regulatory body’s rules while on the road. Just like how we plan for summer vacations, we must always plan, study and then decide with insurance policy to take.


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