Two-wheeler insurance is one of the most popular insurances sold in India. To solidify the bond between the insurer and the users, the Insurance Regulatory and Development Authority of India has introduced rules and regulations. The purpose of these guidelines is to delineate a pleasant journey for customers who are new to the insurance world. Customers must follow these guidelines at the time of buying a policy to avoid future consequences.
As per basic IRDA guidelines, Two-wheeler Insurance Policies usually offer coverage for scooters and motorcycles. There are of two types, namely:
A Comprehensive Two-wheeler Insurance Policy covers the insured vehicle under the below circumstances:
Conditions under which a Comprehensive Two-wheeler Insurance Policy doesn’t cover the insured vehicle:
Third-Party Liability Insurance Policies cover the insured vehicle under the following circumstances:
Here’s when a Third-Party Liability Insurance Policy doesn’t cover the insured vehicle:
Note: These exclusions are applicable on most two-wheeler insurance policies. We recommend going through the documents thoroughly to avoid any consequences while claiming your bike insurance or to avoid claim rejection.
The IRDA also has set rules for calculating depreciation, mentioned in the guidelines. The percentage of depreciation applied in the various parts is as below:
Insured Declared Value (IDV) plays a crucial role while deciding the premium for a Two-wheeler Insurance Policy. Refer carefully to the guidelines given in your policy document. The IDV determines the current market value of the vehicle, which consequently decides the basis of the sum insured.
Additionally, costs of side accessories and other parts are considered as well. The rate of depreciation applies to the insured declared value as well. It depends upon the age of the vehicle. The IDV is crucial because it decides the principal price in calculating the total loss. The depreciation percentage starts with a slab of six months to ten years. The IDV for vehicles older than five years or discontinued models is decided mutually by the issuer of the policy and the policyholder.
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