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Why Do You Need to Buy Long-Term Insurance for Two-Wheelers?

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Published on March 8, 2022. EST READ TIME: 3 minutes

As with any other insurance policy, there are several factors to be considered when it comes to buying a bike insurance plan. While you will only look at the premium cost of the policy when buying a long-term two-wheeler insurance coverage, there are plenty of other aspects that must be given equal consideration. Though we all like to get as much as we spend, it is not possible in most cases. It is best if you make informed decisions when dealing with insurance so that you get the best in terms of coverage and rates.

What is the procedure for long-term two-wheeler insurance?

Before we get into the specifics, let's look at how a typical bike insurance coverage works. Bike insurance policies are classified into two types:

1. A third-party bike insurance plan

2. A comprehensive two-wheeler insurance policy

The former includes third-party property loss as well as third-party death or physical harm. Damages to your motorcycle are not insured. The second kind covers damage or loss to your insured car as well as third-party liability. The premium amount for a long-term plan varies from that of a standard two-wheeler coverage. A long-term two-wheeler insurance policy's premium amount needs to be paid in one lump sum.

Advantages of Long-Term Two-Wheeler Insurance

1. Saving money on Premiums

The IRDAI controls third-party bike insurance prices. Insurance firms are not permitted to provide standard third-party insurance coverage at a price greater than that set by the IRDAI. However, the regulating agency raises insurance prices by over 20% each year.

Therefore, if you get a one-year bike insurance coverage, you will very certainly be obliged to spend a 20% higher price when renewing the plan the following year. This may be prevented by implementing a long-term two-wheeler insurance policy.

2. Remove the Stress of Insurance Policy Renewal

The cumbersome renewal procedure is among the most prevalent reasons why consumers fail to renew their ongoing bike insurance policies. However, while this may have been an issue in the past, online bike insurance services have removed these obstacles.

Many individuals, however, continue to assume that policy renewal is still a time-consuming and paperwork-intensive procedure. Long-term two-wheeler insurance is an excellent option to avoid annual renewals; your bike will be covered for multiple years, and you will not have to stress about renewing the insurance coverage every year.

3. Prevent Policy Gaps

Driving a bike without a credible third-party liability or comprehensive insurance policy is a serious offence. It might lead to serious repercussions, including arrest. Furthermore, if the insurance expires, you will have to buy new coverage and go through the same documentation and inspection process again. All of this is readily avoidable with the assistance of long-term two-wheeler insurance coverage. A single purchase, safeguards you against the grave consequences of the insurance coverage gap for many years.

4. Loss of NCB

Among the most significant advantages of prompt insurance renewal is the accrual of the No Claim Bonus. It entitles you to a reduction in your insurance price given that you have not made any claim in the previous year. The NCB for the first claim-free year is usually around 20%, and it will climb to 50% in the fifth consecutive claim-free year. However, if you fail to renew your bike insurance policy within the given time period, you will be risking your NCB. Long-term two-wheeler insurance, whether purchased online or offline, does not need you to stress over the collected NCB rates each year.

5. Prevent Break-Ins

Suppose you haven't renewed your bike insurance policy in the previous three years. Now, if you wish to get a new two-wheeler insurance policy, your insurer may need to check your motorcycle because there is a significant gap between the plans. These rules are sometimes referred to as 'Break-in' policies.

If your insurance provider determines that your motorcycle is not in an "insurable" state, they may reject your application for bike insurance. Even if the application is granted, the premium rate will be expensive, and the IDV of your bike would suffer. A long-term two-wheeler insurance coverage might assist you in avoiding this situation.

6. You may terminate your policy at any time

A long-term two-wheeler insurance coverage is a significant investment. What if, after buying, you are dissatisfied with the insurance company's offerings? What if the insurance company's claim process turns out to be extremely complicated? In such instances, you have the option to terminate your coverage and move to a new insurance provider at any time.

The unutilized premium money will be refunded by your existing insurance provider. You can also transfer your existing No Claim Bonus to your new insurance provider. Before terminating your old insurance coverage, you must get a No Claim Bonus certificate from your existing insurance provider and buy the coverage from your new company. If you file the NCB certificate to your new insurance company, your ongoing bonus will be moved to your new bike insurance policy.

Conclusion

Based on the merits detailed above, investing in a long-term two-wheeler insurance policy can spell out a host of benefits. So, if you’re looking at renewing your existing policy, why not spend a few extra bucks? Your vehicle will be insured against all kinds of unfortunate incidents with its comprehensive coverage and you won’t have to worry about frequent renewals. With so many benefits to enjoy, multi-year plans are bound to help you save money in the long run.

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

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