Looking At Recommendations Of Bike Insurance Add-ons for New Bikes Vs. Old Bikes

Just like a health insurance policy has additional riders to increase your protection when health crises strike, a bike insurance policyholder has add-ons to increase the coverage for your bike. While most add-ons are optional and can be purchased with a comprehensive bike insurance policy, the personal accident cover is mandatory and is available for purchase with third-party bike insurance policies as well. 

The add-ons you should choose for your bike depends on several factors – the primary one is the vehicle’s age. Old bikes and new bikes have varying coverage needs and the same is reflected in the add-ons they require. In this article, we take a look at some add-ons that would be specifically suited for new bikes and some add-ons that are suited for old bikes.

Bike insurance add-ons for old bikes

If you are planning on buying a second-hand bike or simply want to review your coverage for your old bike, here are some important add-ons you should consider- 

1. Zero depreciation cover 

The zero depreciation cover is one of the most popular add-ons for bikes. For the uninitiated, the zero depreciation cover offers the two-wheeler insurance policyholder protection from the depreciation cut that occurs during claim compensation. As your bike ages, it undergoes gradual wear and tear due to daily usage. This leads to a slow reduction in its overall value referred to as depreciation. So, when you raise a claim, the bike insurance provider considers this depreciation value and deducts it from the claim amount before compensating you.  As per the IRDAI, a 6-month old bike would incur a 5% depreciation cut, a 1-2 year old bike would incur a 20% cut, and a 2-3 year old bike would incur a 30% cut, and so on. 

However, if you have a zero depreciation add-on with your bike insurance policy, the insurer is liable to give you the entire claim amount without any consideration of the depreciation. Therefore, this can be a very useful add-on for old bikes. 

However, do keep in mind that this bike insurance add-on is available only for bikes up to a specific age. Mostly, bikes that are over 5 years old may not be eligible for this add-on. 

2. Consumables cover 

Most two-wheeler insurance companies usually do not cover the costs of consumables such as nuts and bolts, engine oil, lubricants, sealants, and so on. The requirements of these become more prominent as the bike ages. Moreover, finding parts for old bikes may be difficult and could incur extra costs as well. So, consumables cover can come in handy during such situations. 

3. Roadside assistance cover 

This add-on makes you eligible to receive assistance when you are stuck in a situation in which your bike has undergone a breakdown while out on the road. As these breakdowns are more likely to happen with older vehicles, you might want to consider opting in for this add-on.  If you get stuck out on the road, you can call up your two-wheeler insurance provider and they will send in immediate help for you provided that you were riding your bike within their geographical limits. 

Bike insurance add-ons for new bikes 

If you have recently bought a new bike, or are planning to renew your coverage for a year-old bike, then the following add-on/s might be suitable for you. 

1. Return to invoice

The return to invoice or RTI is an add-on offered by most two-wheeler insurance providers and is immensely helpful for new bikes. Essentially, the RTI helps you get the full amount that was mentioned in the invoice for your bike. 

In usual circumstances, when you raise a claim for damages, you get the claim amount corresponding to the damage. However, in cases where the bike is damaged beyond repair or it is stolen and cannot be recovered, the insurer pays you the Insured Declared Value or the IDV, which is the current selling price of your car minus the depreciation. It also subtracts the road tax and registration cost. However, if you have purchased the return to invoice cover along with your bike insurance policy, then the insurer is liable to pay you the original price mentioned on the invoice of the bike. The depreciation would not be taken into consideration, and you will also get the road tax as well as the registration cost reimbursed to you. 

Let’s look at an example in which you have bought a bike for Rs 65,000. During the purchase, you also paid Rs 2000 for registration costs and Rs 10,000 as road tax. Now, in an unfortunate incidence, your bike gets stolen after 6 months of purchase. Normally, you would get the IDV minus the depreciation cut. You would probably suffer a loss of around Rs 12,000. With the RTI cover, you can get the Rs 12,000 reimbursed as well, thus saving you from losses. 

Most insurers offer the RTI for new bikes only

2. No Claim Bonus Protector

The No Claim Bonus is a concept by which the policyholder gets a discount on their bike insurance premium when they do not raise any claims during a policy term. The NCB is recurring in nature and keeps getting accumulated with each claim-free year. However, even one claim can lead to the policyholder losing the NCB. What the NCB protector does is allow you to get a claim-free discount even after you have made a certain number of claims in a year. This is especially preferable for new bikes because the premiums for a new bike are comparatively higher than for an old bike. By opting for the NCB protector, the new bike owner can save some money on their bike insurance premium. 

Another reason why NCB may be beneficial for a new bike is that it is less likely to suffer serious damage. During an accident, an older bike is more likely to suffer more damages than a new bike and has higher chances of requiring repair.

Do make sure to renew your bike insurance policy on time so that you ride your vehicle in compliance with the law.  Take care and ride safely.