Know About IDV and NCB in Two Wheeler Insurance

When it comes to two-wheeler insurance, there are some crucial terms which you should understand. The understanding of technical jargons can improve your insurance purchase experience. Also, it can even help you avail the policy in a much better manner. Two such important insurance terms are Insured Declared Value (IDV) and No Claim Bonus (NCB).

What is Insured Declared Value (IDV)?

The Insured Declared Value (IDV) is the market value of a two-wheeler vehicle. It is the maximum sum insured amount that an insurance provider promises to offer to a policyholder in case of theft or total loss of a two-wheeler. Basically, the IDV determines the amount of reimbursement that a policyholder is entitled to receive as repair or replacement cost in case of total damage of the two-wheeler.

Like all tangible things, the value of two-wheeled vehicles also depreciates over time. The premium of an insurance policy is directly proportional to the bike's IDV. Therefore, as your bike becomes older, the IDV reduces, which will lessen the premium amount as well. The IDV can be calculator with the formula given below:

Insured Declared Value = (Company’s listed selling price – depreciation value) + (Cost of bike’s accessories excluded from the listed selling price – depreciation value of accessories).

Age of the Two-Wheeler

Depreciation Rate

Less than 6 months


More than 6 months but less than 1 year


More than 1 year but less than 2 years


More than 2 years but less than 3 year


More than 3 years but less than 4 year


More than 4 years but less than 5 year


What is No Claim Bonus (NCB)?

No-Claim Bonus is a reward given in terms of discount on the premium amount. The insurance providers provide this bonus to its policyholders, who have not requested a single claim during the financial year of the two-wheeler insurance plan. The NCB can be availed only at the time of two wheeler renewal.

This benefit plays a very significant role in lowering down the premium amount of the bike insurance policy. The discount offered under NCB starts from 20% and goes up to 50%. The No Claim Bonus (NCB) can be carried forward only if the bike insurance plan is duly renewed within 90 days of the expiry date of the previous plan.

In simple terms, it can be understood as a bonus to appreciate smooth and responsible bike riding and keeping it safer with excellent maintenance. Many people refrain themselves from filing a claim and decide to bear minor bike repair expenses. It makes them stay entitled to avail the NCB during the renewal of the bike insurance plan. It is the best way to not lose a big benefit for a small profit. The table below is explaining the implementation of No Claim Bonus (NCB) :

Claim Free Years

No Claim Bonus

No claim in the first year


Two continuous claim free years


Three continuous claim free years


Four continuous claim free years


Five continuous claim free years


Take Away

With the above description, you must be able to understand the IDV and NCB terms with their significance in the two-wheeler insurance. In future, you should consider the IDV value while making the claims and must make right decisions to sustain and avail NCB benefit without any hassle.

Also Read:

Difference Between Comprehensive and Zero Depreciation Bike Insurance Policy

All You Need To Know About No Claim Bonus in Two Wheeler Insurance

"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."

Add-ons For Your Bike Insurance Policy

  • Zero Depreciation
    Zero Depreciation

    Like other assets, the value of your bike also depreciates constantly with time and the liability of this expense by default rests with the policyholder. A zero depreciation add-on protects you against the depreciation expenses incurred by your bike. Thus, if you opt for a zero depreciation cover, depreciation expense of your bike is not deducted from your claim amount at the time of a claim settlement. This add-on is available with comprehensive bike insurance plans as well as standalone bike insurance plans. This is one of the most popular and recommended bike insurance add-on covers.

  • Invoice Protection
    Invoice Protection

    In case of total loss (more than 70% damage) or theft of your bike, the insurance company pays you the Insured Declared Value of your bike as compensation. However, this Insured Declared Value (IDV) is less than the invoice price which you pay at the time of purchasing your bike. The Invoice Protection add-on cover helps you claim the Invoice Price, i.e. total ex-showroom price of your bike plus taxes plus registration charges, of your bike in case of total loss or theft of your bike.

  • NCB Cover
    NCB Cover

    No Claim Bonus is the reward which is given to the policyholder for not making any claim during the policy period. This reward is offered by the insurer in the form of a discount on the own-damage premium of the bike insurance policy at the time of policy renewal. The NCB ranges from 20% to 50% of the own-damage premium depending on the number of claim-free years. However, if you make even a single claim during the policy period this NCB gets lost. But, with the NCB Cover, you can keep your NCB intact even after making a claim during the policy period.

  • Engine Protection Cover
    Engine Protection Cover

    The damages incurred by the engine of the bike are by default not covered under a bike insurance policy. However, if you opt for an Engine Protection Cover, the insurer will be liable to compensate you for damages incurred by the engine of your bike such as damage due to leakage of lubricants, water ingress, hydrostatic lock, damaged gearbox, broken crankshafts or pistons and cylinders. The repair cost of the internal engine parts is often high and can sum up to thousands of rupees or more. Thus, addition of this add-on to your comprehensive or standalone bike insurance policy can save you from these expenses.

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