8 Factors that Influence the Cost of Bike Insurance Policy

by Kanika Shelatkar Insurance Consultant

Purchasing a two-wheeler has become more of a necessity nowadays owing to transportation concerns. A motorcycle spells freedom, convenience, and availability at all times. If you want to keep your two-wheeler guarded all the time, it is better to opt for a comprehensive motor insurance plan. This not only protects from natural calamities but also human made mishaps. When your asset gets protected under a decent insurance scheme, you need not fret due to sudden expenses owing to unexpected events such as theft and accidents.

Also, the bike insurance does not come with a fixed price and several factors affect the premium. It is essential to understand why the insurance quotations get affected. Here are some of them –

Value of the bike

The brand name and functionality offered by the bike vehicle defines the value of the bike. Since Harley Davidson is expensive compared to Bajaj Avenger, the cost of insurance for Harley will be more than that of Bajaj Avenger. Generally, the cost of insurance policy for a bike is 2-3 per cent of the bike’s market value.

Type of two-wheeler

The quality and the bike specifications determine the cost of the bike. It also determines the value of the bike insurance policy. The cubic capacity of the bike’s engine plays one of the most crucial roles in assessing the cost of the insurance policy. Insurance will be higher for a bike with higher cubic capacity.

Bike riding skills

The skills of the rider matter. If the biker is careless, the chances of accidents increase. More the number of accidents, the more will be damage claims. It will increase the cost of insurance policy due to frequent claims.

Affiliations

A lot of bike insurance providers offer a discount if you are affiliated with specific organisations, for example – the Automobile Association of India.

Modifications

If you have modified your bike to increase its performance or changed it aesthetically to make it look cooler, it will increase the cost of your insurance policy. If the modified part gets damaged, it will cause a hefty financial loss. To prevent this, it is advisable to insure the parts. This process will increase the price of insurance. More the number of modifications, higher will be the cost of bike insurance.

Add-ons

Extra coverage under a comprehensive bike insurance policy is termed as add-ons. They are to be added depending on your requirement. However, buying add-ons can increase the cost of the policy.

Security devices

If your bike is stolen, the insurance company will verify if you had taken safety precautions to prevent the theft. Your claim is settled only after the insurer is convinced that you were careful enough to not leave the keys in the ignition or park it in a theft-prone area. To safeguard your bike from being stolen, install an anti-theft device. The two-wheeler insurance company may reduce the cost due to this.

Discounts

Most of us are not aware of the discounts given on insurance policies. One such discount is the No Claim Bonus. As the name suggests, you are eligible for a No Claim Bonus (NCB) when you do not file any claim against the bike insurance policy in the previous year’s policy-term. You can get as much as 50 per cent discount on insurance premium under NCB.