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What is IDV in Two Wheeler Insurance?

The full form of IDV describes Insured Declared Value. IDV in two-wheeler insurance is the total value of the insured’s vehicle that is decided by an insurer to compensate the insured in case of damage or total loss of the vehicle. Simply put, IDV is the maximum sum insured fixed by two wheeler insurance company to compensate you (the policyholder), in case of a misfortune event like theft or total loss due to an accident. IDV in two-wheeler insurance is calculated after taking into consideration the manufacturer's listed selling price and then the depreciation.

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Why Is IDV In Two-Wheeler Insurance Important?

IDV is short for Insured Declared Value which refers to the maximum amount of claim that your insurer will pay in case your two wheeler is damaged beyond repair or is stolen. IDV plays a vital role in bike insurance and helps you to make an informed decision while purchasing a two-wheeler insurance policy. Note that lower the IDV, lower the premium you will be required to pay for your two-wheeler insurance policy. But the wise decision is to choose the IDV closest to your two-wheeler’s market value. This ensures fair compensation if you make a claim in case of theft or damage.

How to Calculate IDV in Two-Wheeler Insurance

IDV in bike insurance is calculated on the basis of market value of your two wheeler when the policy commences which keeps changing with time and depreciation is included while IDV is calculated. IDV is not calculated on the basis of the premium you pay for your bike insurance policy so it is advised to get an insurance policy for your two wheeler as soon as you purchase it to avail high IDV.

Rate of Depreciation on Two Wheelers

The following table shows how depreciation schedule of IDV in two-wheeler insurance:

Age Two-Wheeler

Depreciation Percentage to Calculate IDV

Two-wheeler not more than 6 months old


More than 6 months, but not more than a year


More than 1 year, but less than 2 years


More than 2 years, but less than 3 years


More than 3 years, but less than 3 years


More than 4 years, but less than 2 years


Note: IDV for vehicles more than 5 years is decided by mutual agreement between the insurance company and the insured.

Factors Affecting IDV In Two Wheeler Insurance

There are some factors which affect the IDV of your bike. Listed below are some of those factors that affect the IDV of your two-wheeler:

  • Age of two wheeler
  • Make, model and variant of two wheeler
  • Accessories added
  • City of registration
  • Fuel type
  • Insurance policy term

Insured Declared Value for Two- Wheeler Above 5 Years Age and More

A two wheeler’s age is directly related to the rate of depreciation that will be calculated on the two wheeler. As the age of two wheeler increases, the rate of depreciation on the two wheeler also increases. In simple words, as the two wheeler’s age increases, it’s value decreases.

For a two wheeler that 5 is aged 5 years or above, its depreciation shall be calculated on the basis of the condition of its parts and serviceable condition. The Insured Declared Value gets adjusted accordingly in case different components are made using different materials, and the final value is determined as an overall average.

If the two-wheeler is aged above 5 years or is an obsolete model, then the last Insured Declared Value could be computed by a mutual consent between the policyholder and the insurance company.

There are certain insurance providers that take the help of surveyors to get to the right Insured Declared Value in insurance. This results in an extra cost that needs to be borne by the policyholder.

Difference Between IDV and Premium Rates

People often get confused between IDV and Premium. However, these two are related but different concepts. IDV refers to the market value of your bike, whereas premium is the amount which you pay to get your bike covered under an insurance plan.

Premium is directly proportional to IDV. If the premium rate in your two-wheeler insurance policy is low that means a lower IDV. Thus, people tend to believe, lower the IDV, the better it is. However, that’s not the case. A lower IDV is not beneficial because at the time of a claim settlement, it will result in a lower claim amount.

Now that you know how important it is to know the right IDV of your two-wheeler, you should also know that you can calculate it by using an IDV calculator online. IDV calculator is an online tool that determines the market value of your two-wheeler and also gives you an idea of the premium you will be required to pay to own the policy.

In case of any doubt or query related to IDV in two-wheeler insurance, you can get in touch with the customer care executives at InsuranceDekho.

What is the Importance of Insured Declared Value in Two-Wheeler Insurance?

IDV in bike insurance refers to the maximum claim amount that the insurance provider will pay you in case of total damage or theft of the two wheeler, so it is a very important aspect in bike insurance policy. IDV not only helps in determining the real value of your two wheeler but also helps in determining the premium amount that you will pay for a two wheeler insurance policy. Below mentioned are some reasons that justify why IDV in bike insurance is an important aspect:

  • Determines Right Value of the Two-Wheeler: Insured Declared Value helps in determining the right value of the two-wheeler. This is because its value depends on various factors like bike’s make, bike’s model, bike’s cc, registration city, etc. Henceforth, it is significant to state the correct Insured Declared Value.
  • Two-Wheeler Insurance Premium: The premium you pay against your bike insurance plan is dependent on various factors including policy type, bike’s cc, make of the bike, model of the bike, claim history and importantly the Insured Declared Value.
  • Claim Amount Dependent on IDV: In case of loss and damage to the insured vehicle, IDV is basically the highest amount that the policyholder can receive. To reduce the amount of premium, some individuals state incorrect IDV values. However, it is a disadvantage for them because as in the case of claim too, they would receive a lesser value, and that amount may not prove to be enough for your bike.

What Happens in case I Opt For a Lower Insured Declared Value?

Let us take a look at what would happen if you would select a lower Insured Declared Value for your two-wheeler:

- The premium amount of your insurance plan would reduce.

- It would help you in saving money on your two-wheeler insurance plan.

- But, the sum insured of your insurance plan would get reduced.

- Thus, you would get lesser compensation in the event of total damage or loss of your insured bike.

What Happens in case I Opt For a Higher Insured Declared Value?

You can opt for a higher Insured Declared Value in your insurance quote and take advantage of the benefits that come with it. Let us take a look at what happens if your increase your two-wheeler's IDV:

- The sum insured under your two-wheeler insurance plan would go up.

- A higher sum insured can be of great help in the event of total loss or damage of your insured bike.

- However, the premium payable towards your bike insurance plan would also go up.

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Select your Two wheeler brand

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When did you buy your Two wheeler?

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    IDV in Bike Insurance FAQ

    • Why is the right amount for IDV important?

      It is important to have a correct IDV as it affects both your premium amount as well as your claim amount. A lower IDV will result in a lower payout at the time of a claim settlement whereas a higher IDV will unnecessarily put a strain on your pocket as it will result in a higher premium. Thus, it is important to get the correct IDV.

    • How should I calculate the IDV of my bike?

      You can simply visit InsuranceDekho, enter your two-wheeler’s registration number to get the IDV of your bike. If you don’t remember the registration number of your two-wheeler, you can select its Make, Model and variant to get the IDV and premium quotes instantly.

    • Will it be beneficial if I declare an incorrect value of my IDV?

      Declaring an incorrect IDV value is not beneficial in the future. At the time of making claims, it will affect the amount you will be getting on the damage/losses incurred to your two-wheeler. The Claim amount is calculated on the basis of the IDV value.

    • Does the value of IDV decrease?

      Yes, the IDV of your bike decreases with time due to wear and tear.

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    #Applicable on non-inspection cases i.e. existing policy has not expired or when buying a policy for a new vehicle.