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IRDAI Guidelines For Bike Insurance Policies In India

Published On Mar 15, 2021

This article mentions the top 5 IRDA guidelines for bike insurance in India. It begins with an introduction of the IRDA and then mentions the guidelines in detail.

The Insurance Regulatory and Development Authority of India (IRDAI) is the highest authority for insurance-related rules and regulations in the country. From deciding the amount of premium to the term of a single policy, IRDA ensures a smooth relationship between insurance providers and their customers. If you are a new entrant, it is necessary to be aware about new insurance guidelines. To help you in this regard, we are going to talk about IRDA guidelines for bike insurance policies in India. This article is for all those new bike owners who are unsure about investing in an insurance policy without comprehending its terms completely. 

IRDAI Guidelines For Bike Insurance Policies In India

IRDAI Guidelines For Bike Insurance Policies In India 

The following is a list of pointers that explain in detail the IRDA guidelines for a bike insurance policy in India.

  • Type of Coverage 

The IRDAI stipulates the kind of coverage bike insurance policies offer in India. For comprehensive bike insurance policies, IRDA holds that there should be coverage for a loss or damage due to an accident, theft, vandalism and a natural or man-made disaster. The damages covered should also incorporate a third party liability arising out of physical injury or death and must provide a personal accident cover. 

  • Exclusions 

Exclusions are clauses decided by IRDAI for which bike insurance companies are not obliged to make any payments to a policyholder. For example, you will not receive any reimbursement in case your bike suffers from a mechanical breakdown, an accident under the influence of alcohol or any other psychotropic substance, any damage sustained beyond the jurisdiction of the policy or any claim arising out of contract liability. These exceptions are a part of all bike insurance policies and you should read these points closely to avoid claim rejection. 

  • Depreciation Rules 

IRDAI also rules the calculation of depreciation in bike insurance policies. For fibreglass components, the depreciation value is 30%. For parts made up of rubber, nylon, tubes, batteries or plastic, the value is 50%. There is no depreciation value for glass parts and for metal made parts, the value corresponds to different policy terms. 

  • Insured Declared Value 

The Insured Declared Value (IDV) is the most important factor in your bike insurance policy and is the highest amount of money paid to you for any kind of damage or theft. The IRDAI maintains the benchmark of this amount and currently it is equal to the present market value of the bike. While buying an insurance policy you must bear its information in mind and not settle for a policy that offers a lesser IDV. 

  • Personal Accident Cover 

As per the latest guidelines of the IRDAI, all bike insurance companies have to provide a mandatory personal accident cover of INR 15 Lakh. This rule is now applicable to both comprehensive and third-party liability policies and covers the accidental death or the owner-driver, permanent or partial disability and temporary disability due to a mishap. It is advisable to be aware of these basic principles while buying a bike insurance policy. 

Take Away

 These are the most significant guidelines of IRDAI on bike insurance policies in India. The pointers mentioned above will hopefully help you to be aware of the coverage, exclusions, IDV and other regulations of bike insurance policies that you are mandated to receive. You must always buy an insurance policy for your bike as it will prove to be a source of guaranteed funds in a time of crisis or need for yourself and your bike, as outlined above. 

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.

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