Why Should You Obtain Long-Term Two-Wheeler Insurance?

Two-wheelers have the highest rate of uninsured automobiles in India. One of the primary reasons for this is that, until recently, two-wheeler insurance was only available for a year. Last year, the Insurance Regulatory and Development Authority of India (IRDAI) allowed insurers to provide three-year long-term policies for two-wheelers to solve this issue.

Why Should You Purchase A Long-Term Two-Wheeler Policy?

The following are some of the Long-Term Two-Wheeler Insurance Benefits:

Discounted Offers

Policyholders might get discounts on long-term two-wheeler motor insurance. Long-term plans allow insurers to save money on administrative costs, therefore they provide various discounts and incentives to customers. This is in addition to the company's underwriting benefits and no-claims incentive. Personal damage coverage is not needed by law, but third-party liability insurance is. Insurers like New India Assurance provide upfront discounts for their own damage insurance with their three-year third-party insurance plans.

Long-Term Insurance Renewals for Two-Wheelers

It's significantly more convenient to renew a policy every two or three years rather than every year, especially if you have a lot of them. When a policy's term ends, the policyholder must go through a long renewal procedure. A policyholder will not be able to submit a claim if an accident happens after the policyholder's renewal date. In addition, the insurer may request a vehicle inspection before renewing or issuing new insurance. Furthermore, if your insurance has been lapsed for a long time, finding an insurer willing to cover your car may be tough.

Premium Rates for Long-Term Two-Wheeled Insurance

Premiums for third-party insurance have been continuously growing in recent years. IRDAI raises the price of third-party liability insurance by 20% per year. For the first three years, if you had to buy long-term car insurance, your rates would not change.

Bonus if you don't File a Claim

Long-term two-wheeler insurance plans offer an advantage over short-term policies when it comes to the no-claim bonus (NCB), as various insurance policies have demonstrated. If the policyholder has not made any claims in the preceding year, an NCB is provided for the following year of the policy. Long-term two-wheeler insurance policies provide higher no-claim bonus slabs than short-term two-wheeler policies. For example, ICICI Lombard extends the same NCB discount to new clients as it does to existing policyholders. If customers obtained a 30% NCB from a previous insurer the previous year, ICICI Lombard will provide them the same incentive when they purchase their first long-term insurance policy.

Cancellation/Termination of a Long-Term Two-Wheeled Insurance Policy

When a policy is terminated, certain insurance companies provide payments to policyholders. In the event of loss or theft, ICICI Lombard, for example, offers a return of up to a certain percentage of the cost of their long-term insurance for the entire unexpired years — a benefit not available with single-year policies.

NCB is being Depleted

If you haven't filed any claims in the past year, you may be eligible for a rate decrease. The NCB is 20% for the first claim-free year, and it can increase to 50% in the fifth claim-free year. You risk losing your NCB if you do not renew your bike insurance during the grace period following the expiration of your previous policy. If you obtain long-term two-wheeler insurance online or offline, you won't have to keep track of your accumulated NCB every year.

Take Away

Long-term motorcycle insurance comes with a slew of benefits. Deflation in premium rates is infrequent and should not be worried about. If you are not planning to sell your two-wheeler anytime soon, a multi-year bike insurance policy is the best thing you can do to ride with confidence.

Also read: Tips To Prevent Two Wheeler Insurance Claim Rejections

For a variety of reasons, bike insurance claims may be denied.