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In Focus 26 Aug 2020 How to choose the ri ...

How to choose the right two-wheeler insurance plan as per your need

SPOTLIGHT
Published Aug 27, 2020, 2:20 pm IST
Updated Aug 28, 2020, 4:09 pm IST
Understand the key points that one should evaluate before buying two-wheeler insurance
Bajaj Allianz General Insurance.
 Bajaj Allianz General Insurance.

Nearly 1.51 lakh people died in road accidents in the year 2018 [1]. This is a scary statistic. Further, even in the case of survivals, the vehicles are on the receiving end of maximum damage. This can lead to heavy expenses, especially if they are not protected by an insurance cover.

Life is unpredictable. One moment you may be having the time of your life and the other moment may witness the turn of tides. While you have no control over time, what you can, however, control, is how to recuperate if life takes a bad turn. Insurance is one such cover!

 

The Covid-19 impact

Covid-19 has been the biggest turn of the year. This has not only led to a worldwide health scare in the absence of a vaccine but has also led to a tumbling of the world economy.

Japan has been hit by the greatest economic slump in the second quarter as its economy shrunk by 27.8% [2]. U.S. economy has been hit so badly that it will take around three years for it to recover, as per the predictions [3]. Back home, as per the International Monetary Fund, India's economy has shrunk by 4.5% [4].  

On a micro level, this has led to people prioritizing necessities and taking better care of what they already have. The focus has shifted to sustaining rather than purchasing [5].

 

One way of doing that is by purchasing two wheeler insurance or renewing one.

Too soon, monsoon?

However, in the quest to cut down unnecessary expenditure, people are often looking at insurance renewal for their two-wheelers as a wasteful expense.

This thought stems from the fact that given the vehicle is on a stand-by mode, there is no impending danger. However, is that really the right way to think?

With the monsoons here, even when you avoid getting out on the streets, some or the other necessary arrangement may require you to take your two-wheeler out.

 

In the midst of waterlogged streets and potholes, danger definitely looms, and you need cover for that. Further, even when your vehicle is not in use, there is a certain deterioration that’s taking place, in the form of growing rust or defect in the engine.

You may only be aware of the same when you take it out. Thus, Covid-19 or no Covid-19, it is important to get your two-wheeler insured and timely two wheeler insurance renewal is critical to enjoy continued coverage.

But, how to choose the right type of plan? Every person has a different need. Thus, every plan is different too.

 

How to choose the right type of two-wheeler insurance?

Another 2020 change has come with the form of a circular by IRDAI, which states that insurance companies will not be selling multi-year own-damage policies.

This ruling has given the power of choice and customization in your, i.e. the customer’s hands, thus making it possible for you to switch to another own-damage policy in the next year if you are not happy with the current one. This ruling will also be important in choosing the right type of insurance policy.

With the pandemic and this ruling, 2020 has not only stressed the importance of having your vehicles insured, but also given a way to reduce the stress and cost of insurance.

 

Insurance is important. However, amidst a plethora of choices available, both in terms of offers and the number of insurance companies, how to choose the one which fits the bill for you? Here are a few things to note while choosing the right type of insurance:

Assess your requirement

The first step is to know what exactly your requirement is. This includes figuring out whether you want two wheeler insurance third party or comprehensive cover which comes with an own-damage cover. Then, with respect to your expenditure and any existing liabilities that you may have, decide your requirement.

 

Check the cubic capacity

Cubic capacity refers to the capacity of a two-wheeler’s engine, which ranges between 50cc to 1500 cc. The more the cubic capacity, the more powerful the machine.

However, this also means you will have to pay a higher insurance premium. While this will not define your need for the insurance policy, but this is a fact that you should surely be aware of so that you know how much premium you would be charged. You can also ask your insurance provider whether or not the premium is based on the cubic capacity.

Know the Insurance Declared Value

 

Insurance Declared Value is the vehicle’s market value. You need to know it as this will be the value paid to you in case of complete loss of the two-wheeler.

It is important to know the IDV as it will decrease every year, depending upon the respective depreciation rate on the vehicle. IDV also has an impact in determining the premium value.

Choose the company

It is important to choose an insurance company that aligns well with your requirement. Most of the companies declare their features upfront. However, it is also important to enquire on your end. Ease of requirement is an important thing while looking for a good insurance company.

 

Go for the one that comes with minimal hassle, ease purchase and renewal, and online services, such as Bajaj Allianz which also comes with many add-on features and a rider plan, a protection-enhancing feature, upon payment of additional premium.

In a situation when cities and areas are under complete lockdown, such features online can turn the decisions around for customers. Also, check the claim settlement ratio of the insurer to gauge their efficiency.

Decide the plan

Once you have taken into consideration all of the aforementioned, decide a plan that suits you best. If you feel stuck, connect with an insurance agent.

 

It is important to be aware of all the facets before you are ready to choose your insurance plan. Today, when the pandemic has struck high, there is all the more reason for protecting your two-wheelers, and there is a need to do it the easier way.

Thus, you must choose an insurance cover which is not only replete with all the benefits but also can be purchased and renewed easily, preferably online, such as Bajaj Allianz two-wheeler insurance, which can be easily renewed online, with minimum hassle.

If you are still unsure, know that two-wheeler insurance provides many benefits.

 

The benefits of two-wheeler insurance

Amidst the pandemic and the monsoon, it is of utmost importance that you get your two-wheeler insured. It comes with many benefits, such as:
Personal accident cover
Hospitalization cash
Disability compensation

Benefit on the death of the breadwinner

Apart from the pointers mentioned above, there are add-ons such as depreciation cover, 24x7 spot assistance, and more, provided by insurance companies such as Bajaj Allianz. You have to choose the right insurer to get the right insurance.

Two-wheeler insurance may seem like a slight dent in the pocket, but once you look closer at the picture, it is worth it. The pandemic should be no cause of panic for your two-wheeler, and if you know which insurance plan works best for you, you need not worry.

 

Source:
[1] https://morth.gov.in/sites/default/files/Road_Accidednts.pdf
[2] https://tradingeconomics.com/japan/gdp-growth
[3] https://www.weforum.org/agenda/2020/03/economic-impact-covid-19/
[4] https://www.imf.org/en/Countries/IND
[5] https://www.indiaretailing.com/2020/08/13/food/food-grocery/post-covid-19-how-purchasing-behaviour-is-going-to-change/

Disclaimer: No Deccan Chronicle journalist was involved in creating this content. The group also takes no responsibility for this content.

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