Getting your two-wheeler insured is a responsibility that comes along with your bike or scooter. When people buy a bike insurance policy online, they are advised to memorise the renewal date of the policy. However, a lot of times, people tend to forget the policy renewal dates and ride uninsured on the roads. In the daily hustle and bustle of life, the thought of renewing the bike insurance policy slips out of mind. Driving without an active bike insurance in India is an offense and may land you in unnecessary troubles. Besides, it is not a wise thing to do on the Indian roads without coverage against any unforeseen incidents.
The Dangers of Riding Without A Valid Insurance
As per the revelations made by the General Insurance Council (GIC) for the year 2015-16, there are about 19 crore registered two-wheelers in India out of which 60% are riding uninsured. At the same time, two-wheelers are also involved in the maximum number of road accidents in India.
The situation seems alarming as crores of two-wheeler owners do not have sufficient coverage to aid them in unforeseen incidents that may cause damage or loss to them or their vehicles. The prime reason why two-wheeler owners do not give attention to insure their vehicles is the complicated process of buying and renewing the policy. People like to avoid the paperwork, vehicle inspection, and other hassles associated with the insurance and hence do not deem it to be a necessity.
From a legal standpoint, getting a two-wheeler insurance is mandatory in India as per the Motor Vehicles Act of 1988. Riding a two-wheeler without an active insurance may attract a penalty of up to Rs.1000 or an imprisonment up to 3 months or both.
Why Buy A Multi-Year Two-Wheeler Insurance Policy Online
The Insurance Regulatory and Development Authority of India (IRDAI) observed the existence of unawareness and unwillingness for insurance renewal as the main reasons for non-compliance. Many people also believe it to be a futile expense as they hardly get to make use of it. What they don’t understand is that they cannot predict an unfortunate event and prevention is better than cure.
To encourage bike owners to get their vehicles insured and renew their policies on time, the IRDAI recently allowed insurance companies to offer long-term insurance policies for a period of up to 3 years. Also, if you purchase a bike insurance policy online, the hassles involved in the process will be minimal and you can get the insurance done in a matter of few minutes.
Benefits of A Multi-Year Two Wheeler Insurance
A multi-year bike insurance policy offers several benefits for the insured. Some of which are explained below:
- Saves You From Hassles Of Yearly Policy Renewal: Avoid Hassles of Yearly Policy Renewals: Renewing your two-wheeler insurance policy every year can be a big headache. Insuring your bike for 3 years can be very convenient as you can ride protected for a long term without worrying about the renewals.
- Lower Premium: The premium paid for a long-term insurance policy is lesser than that of a one year policy. Also, inflation causes the premium rate on policies to rise every year by about 10-15%. A long-term two-wheeler insurance policy prevents the insurer against any such fluctuations. Thus, they are required to pay a lower premium. This could be a nice way to lock your premium for up to 3 years and avoid the annual cost revision cycle. The insurance companies also offer various kinds of discounts upfront at the time of buying a long-term bike insurance policy.
- Lower Risk of Policy Laps: Renewing an expired bike insurance policy is a tiresome task. The insured has to state a new insured declared value (IDV) and the new premium value is determined after vehicle inspection. The entire process consumes immense time and the policyholder may have to pay a higher value due to increase in the premium rate. A multi-year bike insurance policy removes this risk and policyholders can enjoy the benefits for up to 3 years without any hassles of renewal.
- No Claim Bonus: No Claim Bonus (NCB) is an incentive that insurance companies extend to policyholders if they have not made any claims on their policy in the previous year. It is in a way a reward that the insurers offer you for riding responsibly. Also, in a multi-year policy, if the policyholder gets an NCB of 20% at the time of policy renewal, the discount will be applicable for the subsequent years as well.
- Avoid Unnecessary Penalties And Losses: Riding without an active two wheeler insurance in India is an offence. Also, as nothing is predictable, a person may get into a situation where he needs to file a claim but won’t be able to due to an expired policy. They may also have to pay hefty fines if they are caught by the traffic cops.
- Easy Policy Cancellation: A multi-year bike insurance policy does not bind you to continue with the policy till its validity lasts. You may withdraw from the policy at any time and the insurer will refund you the unutilized premium value. However, you must buy a new policy before withdrawing from the existing one. Retaining the No Claim Bonus from your old policy is also something important to do.
What Are The Drawbacks of a Long term Policy?
A person buying a long-term insurance policy is immune to the increase in premium rates due to inflation. But they cannot take advantage in case there is a deflation in the premium rates since they have already paid their premiums. Also, they may incur certain amount of loss if they decide to sell off their vehicle.
To Buy or Not to Buy
A multi-year two-wheeler insurance policy brings to you benefits that score more than the drawbacks. The chances of deflation in the premium rate is also relatively low. If you are not planning to dispose of your vehicle in the near future, a long-term scooter insurance policy may save you from unnecessary hassles and will also help you save significant cost.