28th November 2022
Business

Know How Many Claims You Can Raise Under Bike Insurance Policy?

A vehicle insurance policy is an essential requirement for a vehicle owner, be it for a car or bike, irrespective of its usage — for commercial or private purposes. Having vehicle insurance helps you stay on the right side of the law, safeguarding you from fines and penalties.

But other than legal compliance with the Motor Vehicles Act, a bike insurance policy provides a financial cushion. For that, you must claim damages with your insurance company. Every insurer has a specific process for this which is more or less similar barring some minor formalities. 

But as a policyholder, you might have wondered: how many claims can I raise in a policy year? The aim of this article is to answer this question, helping you better understand your bike insurance policy. 

How many bike insurance claims are allowed during one policy period?

In India, there is no limit on how many claims can be raised with your insurance policy. Thus, you can raise any number of claims during a policy period. However, the maximum pay-out during one policy period is capped to the insured declared value or IDV of your policy.

In the case of policies with certain add-ons, for instance, a zero-depreciation cover, insurance companies may place certain restrictions on the number of claims. While these conditions differ across insurers, it is best to be informed about them from the start. *

What are the implications of making multiple insurance claims?

As discussed above, there isn’t any limit on how many claims you can make. But make sure to avoid claims for minor repairs. Doing so will impact your policy in the following ways:

  • Loss of no-claim bonus (NCB)

Comprehensive bike insurance plans enjoy a markdown in their renewal premium by way of the no-claim bonus (NCB). But an insurance company allows such a concession only when no claim is raised in the previous policy period. When you make frequent claims in a policy period, you forgo the accumulated NCB. The amount of such accumulated NCB may range from 20% to 50% depending on how many claim-free policy periods have been there in the past. Moreover, such NCB concession is calculated on own-damage premium and thus, a third party bike insurance claim does not impact the NCB benefits. *

  • Increase in premium 

If you raise multiple claims for bike insurance, the premium of your policy may increase at its renewal. This rise in premium is brought about to compensate for the increased risk that the insurer is required to underwrite. In addition to this rise in premium rates, the insurance policy at the renewal also restores the premium by taking away any accumulated NCB benefits. *

  • Payment of deductibles

As a policyholder, you are required to pay for a specified portion (a nominal amount) of the expenses. This is termed as your policy’s deductible and is defined by the regulator, the Insurance Regulatory and Development Authority of India (IRDAI). When you raise multiple insurance claims, at each claim, you will be required to pay for such deductibles as specified in your policy’s terms, and only after which any compensation will be paid by the insurer.*

* Standard T&C Apply

With these aforementioned drawbacks of making multiple insurance claims, make sure to raise a claim only if the benefit received from the insurance claim is higher than the benefits forgone. Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.