Comprehensive vs Third-party two-wheeler insurance – What’s best?

For a large segment of people in India, the two-wheeler is the primary mode of transport. Although they provide better options in traffic and quick mobility, two-wheeler vehicles are more prone to accidents than four-wheelers.

As per the Indian Motor Tariff act, it is mandatory to have at least third-party insurance for your vehicle. Have you ever wondered what comprehensive insurance and third-party insurance are?

The key purpose of two-wheeler insurance is to compensate for the expenses due to two-wheeler damages or losses incurred by the policyholder or third party, i.e. if it’s your mistake. Two-wheeler insurance has three plans, designed to cover standalone own-damage expenses, third-party expenses, and comprehensive expenses.

• Third-Party Insurance: 3rd party bike insurance policy covers bodily injuries caused to and even the death of a third-party individual. The damage to third-party vehicles or property is also covered by your insurance policy. Premium rates of your third-party bike insurance are based on the cubic capacity of the engine and are decided by IRDAI annually. As per the Motor Vehicles Act, it is mandatory to have 3rd-party bike insurance, without which the driver/owner can receive a fine of Rs 2000 and/or imprisonment of up to 3 months. Hence, for every two-wheeler, it is necessary to have valid third-party insurance for commuting.

• Comprehensive Insurance: This insurance offers extensive coverage as compared to third-party bike insurance. It consists of third-party bike insurance and protects your bike from third-party damages. Comprehensive Insurance also includes its own damage cover so your bike is also safe. The comprehensive insurance covers damages from fires, total loss or irreversible damage caused to your bike, self-ignition, acts of vandalism, terrorism, in addition to damages caused by natural calamities such as cyclones, earthquakes, etc.

Differences between the two types of insurance policies:

• Comprehensive two-wheeler insurance covers both the first-party and third-party liabilities. Third-party two-wheeler insurance is for loss and damage due to a third person’s faults.
• Third-party insurance is mandatory by law, whereas comprehensive insurance is not. However, comprehensive two-wheeler insurance includes third-party liability insurance.
• Third-party insurance policies have a lower premium than comprehensive insurance policies.
• In comprehensive insurance, additional policies are bundled with first party-policy insurance. These add-ons may not be offered in third-party bike insurance.

When getting a comprehensive or a third-party bike insurance policy, always evaluate the coverage you need for the protection of your bike. Compare the best bike insurance plan on Elephant.in and enjoy a hassle-free ride.