What You Should Know About The Mandatory Accident Cover For Your Bike Insurance Policy

Posted on: May 8, 2019 | 3 mins | Written by: HDFC ERGO Team

What You Should Know About The Mandatory Accident Cover For Your Bike Insurance Policy

Meeting with an accident or causing one can change your life in a big way. It can not only burn a hole in your pocket but also cause permanent damages to your health. And in worst cases, even cause death. Due to an increase in the number of accident IRDA had earlier made the purchase of personal accident cover mandatory for all the vehicle owners. Since the start of this year i.e. on January 2019, IRDA has brought about certain changes in the personal accident cover policy which as a bike owner you should be fully aware of. Personal accident cover policy can be purchased to receive coverage against the accidental risks that can arise while riding the two-wheeler.

Earlier, insurance companies provided compulsory personal accident coverage of Rs. 1 lakh to bike owners, but ever since a high court ruling in September 2018, after the kin of a family who had been compensated with the said amount on the death of the policyholder in a bike accident. Post this incident, the High Court advised the IRDA in increasing the cap of the personal accident coverage and made it mandatory for all bike owners to insure their bike with the cover.

However, with the January 2019 ruling, buying a personal accident cover every time you purchase for every new vehicle you buy. This does not mean that you shouldn’t buy a personal accident cover. Getting a personal accident cover is mandatory and one can now purchase the same as a standalone policy. Thus, with this ruling, IRDA has allowed vehicle owners to buy single CPA for multiple vehicles. Hence, since January 1, 2019 the mandatory personal accident has just been unbundled from MOTOR INSURANCE purchase.

Few important points to know about the personal accident cover

IRDA has made it compulsory for all the vehicle owners to purchase this cover, irrespective of its type and size. This also includes making the purchase for a two-wheeler. Thus, if anything happens to the vehicle owner when riding the bike, the family can claim compensation for Rs. 15 lakh.

This cover has to be purchased irrespective of the type of policy you buy. The cover is not just limited to COMPREHENSIVE BIKE INSURANCE cover, but now under a THIRD PARTY BIKE INSURANCE cover too, the cover will offer benefits to the kin of the deceased bike owner. Also, it is important to note that this cover has to be purchased at the time of renewal as well.

Coverage provided under compulsory personal accident cover

The compulsory personal accident cover provides protection to your family in case of your death caused due to an accident.
Rs. 15 lakh is offered as compensation to your family
In case of permanent disability caused due to an accident, Rs. 15 lakh is given to support your finances
50% sum insured is given in case the policyholder loses one limb or one eye

Exclusions of compulsory personal accident cover

You will not be liable to receive coverage under the following conditions

Driving under the influence of alcohol or drugs
If death is caused when the insured is not driving
Driving without a valid driving license

In a nutshell

You can opt out of purchasing this cover if you already hold a personal accident policy offering you a minimum of Rs. 15 lakh sum insured. Or if you have a bike insurance policy with a compulsory sum insured of Rs. 15 lakh for your another vehicle with a minimum sum insured of Rs. 15 lakh.

Keep all the above-mentioned points in mind and don’t forget to renew the plan on time to ensure your family stays financially healthy even in times of your absence.

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

This blog has been written by

Mukesh Kumar | Motor Insurance Expert | 36+ years of experience in insurance industry

A veteran in the insurance industry, Mukesh Kumar has the expertise of handling various functions like Business Development, Underwriting, Claims, Human Resources, Quality Management and Marketing. With rich knowledge of the industry, he loves to share his views on topics of insurance sector and takes special interest in educating people on advantages of having insurance.

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