1. Home
2. Blogs

How to Differentiate between a Third-party and Comprehensive Bike Insurance Plan?

• 
• 
• 
• 0
• 0

When driving a bike in India, it is mandatory by Law under the Motor Vehicles Act to have third party bike insurance. However, when you go to an insurance company, you will realize that there is a choice of taking third party insurance or comprehensive bike insurance. The latter includes coverage of own damage and also third party. They both have advantages and disadvantages; thus, making a choice can be difficult for someone without insurance knowledge. Let us discuss both in detail and help to understand which policy is comprehensive and which one is a third party insurance plan.

Third Party Insurance Plan

As mentioned earlier as well, as per the Motor Vehicles Act, 1988, driving a bike without valid third party bike insurance is illegal. This policy covers any liability that may arise due to any death, injury or damage caused to a third party caused by the bike in an accident. In case of an accident, if there is any damage caused to a third party or an injury or death to a third person, the third party liability policy comes into force, and the insurance company pays for the damages and compensation due to the bike.

Thus, if you have a third party liability policy, there is no financial strain on the insured if anyone has to be paid for damages or injury.

Advantages and Disadvantages of Third Party Insurance Plan

The main advantage of this kind of insurance is that it is more affordable as it only covers third party liability. Also, as it is mandatory by law, it avoids any legal hassles and penalties.

Next, if you want to know the disadvantages of a third party liability policy, it does not cover your own damage. This means there will be no responsibility of the insurance company if there is any damage to the bike due to an accident or theft. Also, if the accident has happened under the influence of alcohol or any other intoxicating substance, there will be no claim under the third party liability insurance.

If you want to have coverage which avoids any financial strain in case of damage to the bike, you need comprehensive bike insurance.

Comprehensive Bike Insurance

Comprehensive bike insurance is an insurance cover for the bike which covers third party liability and also own damage. Though this is not mandatory by law, it always makes sense for all bike owners to have this cover. This is because, under this policy, all damages due to accident, theft, fire, man-made or natural disasters, and even total loss will be covered.

Advantages and Disadvantages of Comprehensive Insurance

The main advantage of having a comprehensive bike insurance cover is that it takes care of any third party liability and also own-damage cover. This ensures that there is coverage in case of an accident, and any kind of damage will be taken care of by the insurance company, leaving the insured stress-free from an unexpected financial burden.

When compared to a third party liability policy, the premium will always be more, but then for the coverage it gives, it is worth it. In the long run, when there is a claim, one realises the importance of a comprehensive insurance plan for the bike.

The following are the main disadvantages of a comprehensive insurance plan:

● The insurance company does not pay for natural wear and tear

● Rubber parts and fibre parts are not paid for unless there is an add-on cover

● There is no coverage for depreciation unless there is an add-on cover of zero deprecation

● If any war or nuclear attack are the reasons for damage, they will not be covered

Exclusions of the Comprehensive Bike Insurance Policy

When compared to the third party liability policy, the comprehensive offer more coverage, but there are some things excluded from this policy as well and knowing these is important.

● Any damage caused if the driver is under the influence of any intoxicating substance like alcohol

● Any claim when an accident happens with the rider driving without a valid driving license

● Any consequential damage is not paid for by the insurance company unless an add-on cover has been taken

● Any accident that happens due to negligence will not be covered and paid for by the insurance company

Difference between Third Party And Comprehensive Insurance for Bike

We have explained both kinds of insurance coverage and their advantages and limitations. However, to see the difference between the two, let us sum them up so that understanding both is easy and will help in making a decision. The main differences are

Feature	Third Party Bike Insurance Plan	Comprehensive Bike Insurance Plan
Legal status	Mandatory	Voluntary
Coverage	Third party legal liabilities only	Third party legal liabilities + own-damage of the bike
Add-ons	Only personal accident cover can be taken	There are multiple add-on options available to enhance the overall coverage of the plan
Premium	Lower	Higher
Claim process	Through the Motor Accident Tribunal	Insurer processes the claim where a surveyor helps them to assess the loss. This can be done in a cashless or a reimbursement way.
No Claim Bonus	Not available	Available

Who Should Buy Third-party and Comprehensive Bike Insurance Plan?

If you are buying a cheaper bike and do not have any qualms about spending out of your pocket if there is damage, accident, etc., then you can opt for a third party only bike insurance plan. However, if you buy an expensive bike where the repair work might cost a lot, it is always advisable to opt for a comprehensive bike insurance plan so that you do not spend a huge amount of money from your own pocket for the repair. Third party bike plans are offered by all insurers, and it is a legal requirement to ply your vehicle on Indian roads. But comprehensive bike plans give you peace of mind so that you do not have to worry about the repair work on the same.

Conclusion

Third party liability and comprehensive bike insurance are two different kinds of insurance plans offered by an insurance company. If you buy an insurance plan for the bike, then you know the difference between the two now and can easily understand which policy is better and which suits your requirements the most. In terms of coverage and stress, a comprehensive plan is always better and recommended for all bike owners.

So when you are buying a bike, you would need insurance and then making an informed decision is always good. A comprehensive insurance plan is more stress-free as the right add-on covers, covers most of the damages, and there is no financial strain at the time of an accident, and the stress is taken by the insurance company.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

RELATED ARTICLES

First, Second, And Third Party in Bike Insurance - What Are They

What Is Covered Under Third Party Bike Insurance

Comprehensive vs. Third Party Bike Insurance

---

• 
• 
• 
•