Congratulations on your new bike! Now, let us discuss the importance of choosing the right two-wheeler insurance policy. In today’s fast-paced world, regardless of whether you are a safe driver, insurance is essential for everyone. Accidents can happen to anyone at any time, and bike insurance provides a significant advantage in such situations.
However, selecting the right bike insurance policy can be just as confusing as choosing the bike itself, given the multitude of options available. One crucial decision you’ll face during this selection process is whether to opt for first-party two-wheeler insurance or third-party bike insurance coverage.
To make an informed choice, it is essential to understand the differences between these two types of bike insurance policies. In an insurance agreement, several parties are involved, each with their roles and responsibilities. Understanding these roles and the significance of first party bike insurance can help you make a better decision.
What Exactly Is 1st Party Bike Insurance?
First-party bike insurance is a comprehensive plan designed to provide complete protection for your bike. Leading insurance providers in India, such as Tata AIG and others, provide this sort of coverage to help you have 360-degree protection.
As the name suggests, this policy offers coverage for first-party liabilities, protecting you, the policyholder. Any damages to your bike are insured under this first-party insurance for bikes, and the compensation for such damages is directly paid to you by the insurer.
What is Covered under a First-Party Bike Insurance Plan?
Let’s explore some examples of cases covered under a first-party insurance policy for two-wheelers:
- Fire Damage: If your bike sustains damage or is destroyed due to a fire accident, a first-party insurance policy covers the repair or replacement costs. It can include damages caused by electrical faults, fuel leakage, or fire-related incidents.
- Natural Calamities: First-party insurance covers damages caused by natural calamities such as earthquakes, floods, hurricanes, cyclones, landslides, and other severe weather conditions.
- Theft: In the unfortunate event of your bike being stolen, a first-party insurance policy ensures you are financially protected. You will be compensated for the value of your stolen bike as per the policy terms and conditions.
- Man-made Perils: First-party insurance also covers damages caused by man-made perils. It includes instances such as riots, civil unrest, acts of vandalism, accidental damage caused by third parties, and other malicious actions leading to damage to your bike.
While first-party insurance for two-wheelers offers comprehensive coverage, it is important to note that certain situations are typically excluded from this coverage. These exclusions may vary depending on the insurance policy and provider, but some common exclusions include:
- Mechanical or electrical breakdown of your two-wheeler
- Depreciation of your two-wheeler
- Regular wear and tear of your two-wheeler
- Damages caused by driving under the influence of intoxicating substances, etc.
What Exactly Is Third-Party Bike Insurance?
Contrary to first-party coverage, third-party bike insurance offers limited coverage. It protects the policyholder against liabilities arising from accidents causing injury or damage to a third party or their property. This type of insurance, known as third-party two-wheeler insurance, is designed to ensure protection for parties outside the insurance contract.
For example, if you have been involved in an accident with your bike, the opposing party can file a claim with the bike insurance company to cover various expenses, such as:
- Medical expenses
- Coverage for third-party property damages
- Unlimited coverage for death or disability of the third party
Now that we have discussed the differences between first-party and third-party insurance, let us explore why it is crucial to buy first-party bike insurance.
The Importance of Having 1st-Party Bike Insurance
The 1988 Motor Vehicles Act requires bike owners to have third-party insurance coverage. Although not mandatory, it is recommended to buy first-party insurance because it provides comprehensive coverage and benefits. It protects you, your bike, and third parties involved in accidents. It also safeguards against damages caused by natural calamities, reducing financial risks.
Additionally, you can customise your policy with additional coverage options when purchasing first-party vehicle insurance online. These include roadside assistance, depreciation coverage, engine breakdown protection, and more. These benefits are not typically available with third-party insurance plans.
For instance, if you’re involved in an accident, the opposing party can file a claim with the insurance company to cover various expenses if you have a 1st-party insurance plan.
Choosing a first-party two-wheeler insurance cover is wise as it protects against third-party liabilities and financial losses from damages to your vehicle. However, it is vital to make an informed choice by carefully analysing your requirements and comparing the available options.
By doing so, you can select a policy that offers tangible benefits in the long run, ensuring comprehensive coverage and peace of mind. You can look into prominent insurance carriers like Tata AIG and others since they offer one of the finest first-party insurance policies at affordable rates.