Ideas to Reduce the Insurance Premium Cost of an Old Bike
Looking to save a few bucks while renewing the insurance of your old two-wheeler? We’ve put together this list of smart tips to help you lower premium costs with an affordable two-wheeler insurance policy.
As per the Indian Motor Vehicles Act of 1988, all motor vehicles – including two-wheelers have to be insured by law.
It doesn’t matter if your bike is new or old, two-wheeler insurance is a must. But, no one likes shelling out a hefty premium for an old bike insurance policy. Worry not, in this guide, we offer some smart tips that will help you keep your insurance premiums within your budget.
#1: Opt for a Long-term Two-wheeler Policy
As per recent mandates of the IRDAI, insurance providers are now authorised to offer long-term two-wheeler insurance policies that provide continuous coverage .
One huge advantage of these long-term plans is that the annual bike insurance premium is lower compared to renewing short-term plans every year.
A Word of Caution: Before you choose a long-term plan, you have to ensure that you'll be using your old bike for the next few years. If you have plans to replace your two-wheeler before that or in the unfortunate case, your motorcycle incurs a significant expense forcing you to switch to a new bike; then this plan is not the best choice for you.
#2: Be Prudent About the Add-ons You Choose
There’s no denying the benefits of bike add-ons. Popular add-ons like zero dep cover, accessories cover, engine protector, medical cover extend the coverage of your policy, helping you cut down costs. However, add-on covers increase premium costs.
The smart choice here is to evaluate each add-on cover and choose only the ones that you are most likely to use. To give an example, if you generally go on solo drives on your bike, then the accident cover for pillion rider add-on cover is not necessary for you. You can skip it, to reduce your overall two-wheeler insurance premium.
#3: Invest in Anti-theft Device
As the name implies, these devices add an extra layer of security for your bike. Most common anti-theft devices sound an alarm when a thief tries to tamper with your bike, alerting passers-by. The latest anti-theft devices even send an alert to your mobile, indicating that someone is attempting to unlock the bike forcefully.
The best part – anti-theft devices cost just a few hundred rupees, making them incredibly affordable.
With an anti-theft device, the risk taken by the insurance company reduces, as your bike’s probability of getting stolen is significantly reduced. Insurers reduce the premium costs for bikes that are fitted with these devices. However, the anti-theft you install must be Automotive Research Association of India authorised for you to get benefit on your insurance premium.
#4: Join a Riders Association
If you’re an avid biker, you can join a rider’s association like the Indian Automobile Association. As per the IRDAI, insurers have to offer a discount for two-wheeler owners who are part of these associations.
A word of caution: However, note that you may not be eligible for a discount just because you're part of the association. You have to meet other criteria like no prior history of accidents and more to avail discounts under this clause.
#5: Avoid Making Small Claims
Insurance providers offer No claim bonus (NCB) to riders who haven't made any claim the previous policy year. Note that NCB is cumulative and increases year-on-year. When you make a claim, you lose the accumulated NCB and have to start all over. NCB discounts are significant and play a crucial role in reducing the overall premiums.
Small claims like a minor scratch or a small dent can be better-taken care of your pocket, instead of getting your insurer to reimburse it. This way, you get to retain your NCB, which, in turn, helps you enjoy lower premiums on renewal.
#6: Renew your Policy On-time
Renewing your policy before the due date, not only avoids legal complications but also helps you enjoy additional discounts and other benefits.
You can set up a reminder to ensure that you don't miss the due date. Some insurers even send timely reminders to policyholders to get them to renew on time. Just like policy purchases, you can renew your bike insurance online with a few clicks.
#7: Go for a Higher Voluntary Deductible
All bike insurance policies have a compulsory deductible component. It’s the amount you pay out of pocket, whenever a claim is made. The compulsory deductible is pre-fixed by the insurer.
Besides, you can opt for a voluntary deductible. It's an additional amount you choose to pay out of pocket whenever a claim is made. Note that the voluntary deductible is decided by the policyholder and not the insurance company.
By choosing a higher voluntary deductible, you can reduce the overall cost of your premium. So, if you’re looking for low premium bike insurance, then you can opt for higher voluntary deductibles. However, there is a disadvantage when you increase voluntary deductible. With higher voluntary deductible, you will have to pay extra money to in order to get your bike repaired.
Make a Smart Choice with these 7 Tips
Use the tips listed here, to choose the right two-wheeler insurance policy for your old bike that offers you maximum coverage, while staying within your budget.