Factors Governing Bike Insurance Premium

There are several factors which you consider when you are buying a bike. Some consider the affordability whereas some consider the practicality. Some go on looks want to show off. You might consider any of these are a few, but no matter whichever bike you buy, one thing you will need to buy along with it is a bike insurance policy.

You might think that buying any kind of insurance is a waste, but as per the Motor Vehicles Act, 1988, having a bike insurance policy is mandatory. The law does not make comprehensive coverage compulsory but it makes third party liability cover a must have. The latter means you are covered for the damages caused to a third party when involved in an accident. This does not include the cost of repairing the damages caused to your own vehicle. When you buy a bike insurance you will see that different companies offer different rates. Various factors are taken into consideration which govern the bike insurance premium. Let us discuss some of the most important factors which are used by the insurance companies to calculate the premium amount.


One of the most crucial factors which affect the premium of the bike insurance is covered. Before you buy a policy, you need to decide the coverage you want. A third party liability cover is mandated by the Indian law, but this coverage is not the ideal one as this will not cover you against many other risks. The other option you have is to take a comprehensive cover which will cover your bike against any accident, theft, man-made and natural calamities. But for a comprehensive cover you will end up paying higher premiums.

Condition of the Bike

Some of the factors that will affect the premium calculation are the age of a bike, type and the cubic capacity of the engine. Usually, a bike with a higher capacity has a higher premium. The brand of the bike, the model of the bike, the class, place of registration, year of manufacture, modifications, accessories, the number of miles driven and showroom price are other factors which will affect the premium.

Experience of the Driver

The insurance companies also consider some factors related to the driver when they calculate the premium. Some of these are the riding experience and claim record. The insurance company will take  a look at your history of claims. No or less number of claims are preferred.

Voluntary deductible

Voluntary deductible  is the amount that you intend to pay from your pocket at the time of the claim. The higher is the amount, the lesser will be your premium. You must choose, this amount carefully and don’t decide a high figure just to save on the premium.


There are various add on covers that an insurance company offers when buying bike insurance. Some of the options given are personal accident cover, zero depreciation policy, etc. If you opt for any of these, you will end up paying a higher premium. You should understand all the covers and then take the ones you think are necessary.

No Claim Bonus (NCB)

You get a discount on your premium amount if you do not make any claim in a policy year. The discount rate increases with each passing year and can reach up to 50%. But as soon as you file a claim against your policy, all you NCB will be nullified.

The insurance company applies a formula to arrive at the premium amount of the bike insurance. The above are some of the important factors which are considered by them and which will affect the premium. You must have a clear understanding of all these factors and ensure you compare quotes from different companies to get the best bike insurance policy.

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