Top 8 Factors Affecting The Cost Of Two Wheeler Insurance

Top 8 Factors Affecting The Cost Of Two Wheeler Insurance

By Dana Hughes | Contributor on June 19, 2018
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Before purchasing a two-wheeler, it is essential to know the ins and outs of how it is ridden. In the same way, before buying a two wheeler insurance policy, it is recommended to know some basic factors that affect its cost. We all think of the high premium of vehicle insurance that we have to pay. But, if we know the factors that affect it, we can take an insurance policy that is more favorable and comparatively cheaper.

Factors affecting the cost of two-wheeler insurance

Type of the two-wheeler: Just as the price of a two-wheeler varies with the model and features it has, the price of the insurance varies in the same way. Therefore, if you are purchasing a bike of the same brand as of your friend and your bike has a better cubic capacity and other features than your friend’s, then you may have to pay more for insurance than your friend.

Value of your two-wheeler: It is quite relevant to the above point. Since the price of a bike or two-wheeler or any vehicle depends upon the features it offers, its insurance varies in the same way. This is because the insurance of a luxury bike like Ducati will, for sure, cost more than a normal 100cc bike. Generally, the premium of the insurance of a two-wheeler is 2 to 3% of its market value.

Riding style: One’s riding style always plays a major role in the cost of two wheeler insurance. It is because, when a rider is not careful while riding the bike or two-wheeler, he/she has more chances of meeting an accident. Since accidents result in the damage to the two-wheeler, one may need to claim the insurance. The cost of insurance is directly proportional to the number of claims you take against it. The more claims against insurance, the higher will be the premium.

Modifications: Any modifications in the bike in order to improve its performance and aesthetics, too, increase the cost of insurance. It is because, in two-wheeler modification, one invests a good amount of money, and hence, loss of even a single modified part may cause a lot of financial loss. Therefore, to avoid this, separate insurance of every modified part is suggested, which results in an increase the premium. In this way, more the modifications in your bike, the more your premium will be.

Anti-theft device: When a two-wheeler is stolen, the insurer checks whether all the security measures were taken by the policyholder or not. The theft claim is settled only when the insurer is sure that the policyholder was not careless with the two-wheeler keys, didn’t leave them with the bike or had not parked the bike somewhere where the chances of theft were more. However, to keep the fear of bike-theft away, one can install anti-theft devices on his/her bike. A bike having an anti-theft device is of less risk to the insurer, which, in turn, reduces the insurance cost. In this way, the cost of insurance is lesser for the bikes having an anti-theft device.

Bonuses and Discounts: Most of the times, a two-wheeler user is unaware of the discounts offered by the insurance companies. One of the most common discounts that most of the policyholders can avail is No Claim Bonus (NCB). One can get the benefits of NCB when he/she has not filed a claim against the insurance policy for an entire policy year. One can get an NCB of up to 50% on a two-wheeler insurance policy for the next year.

Any gap in the renewal of the policy: Generally, all two-wheeler insurance companies give a grace period of 30 days for renewing the policy. However, if one still misses the renewal, he/she has to purchase a new insurance policy, the cost of which is, of course, higher. Moreover, any No Claim Bonus, in this case, will be dismissed as well.

Rider/ Add-ons: Riders or add-ons are the extra coverage that one can take in order to get enhanced coverage. Therefore, these add-ons or riders increase the cost of an insurance policy.

These are the top 8 factors that affect the cost of two wheeler insurance policies. Keeping them in mind, one can reduce the cost of the premium that one has to pay for his/her two-wheeler’s insurance. Though some factors cannot be changed, like the model and make of your bike, but various other factors like bonuses, anti-theft device, careful driving etc. can reduce the insurance cost as well.



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