Third-party bike insurance, also called liability-only insurance, provides coverage to third-party individuals or property due to an accident or damage caused to them by your bike. In India, it is mandatory by law to have a third-party two-wheeler insurance policy to be able to ride your bike on the road.
However, third-party bike insurance does not provide coverage to the owner of the bike. You can buy a third-party liability cover online with minimum documentation. Moreover, this bike insurance is affordable and it safeguards you from the expenses incurred by a third-party due to an accident.
What is Third-party Two–Wheeler Bike Insurance
Bike insurance for third-party policy provides financial coverage in case of liability arising from damage, injury, or even death to a third-party. The insurance company will bear the cost associated with such damage. In case of a third-party death, the claimable amount is decided in a court of law. However, in case of property damage, the compensation amount can be up to the sum insured and the policy conditions
Advantages of Third–Party Bike Insurance Policy
Third-party bike insurance comes with a lot of benefits. It acts like a safety net for you and others on the road.
- Coverage for a third-party: If you accidentally injure someone or damage their property with your bike, third-party bike insurance coverage can help put up with the costs.
- Affordable insurance premium: Third-party bike insurance is generally affordable as it provides protection only to third parties. The premiums for full coverage (that is, comprehensive coverage) are higher.
- Legal Compliance: Third-party insurance ensures that you comply with the legal requirement to have at least third-party insurance to ride a bike. This results in financial protection and safeguards against fines and penalties.
Disadvantages of Third–Party Bike Insurance
Third-party bike insurance has one major disadvantage and that is this policy does not provide coverage to the insured bike or its rider. Let us explore the disadvantages of such a bike insurance policy.
- No coverage for own damage: The coverage of third-party bike insurance is limited to third parties only. It does not cover any damages to your own bike in case of an accident, theft, fire, or natural calamities.
- Financial burden in case of accidents:In case of a severe accident that causes damage to your own bike, you would have to bear all repair or replacement costs, leading to substantial financial strain.
- No optional add-ons: Third-party bike insurance does not offer coverage for optional riders, which is covered under comprehensive bike insurance.
- Higher risk for expensive bikes: Owners of high-value or new bikes may find third-party insurance inadequate, as it does not protect the significant investment made in purchasing the vehicle.
What Coverage Does Third–Party Bike Insurance Provide
Before you buy third-party two-wheeler insurance, check out the features and coverage offered by the policy.
Property Damage
If your insured bike accidentally damages third-party property, then the policy covers the cost of the damages. And the claim under a third-party bike insurance policy can go up to ₹1 lakh. The IRDAI norms make this claim settlement easy for individuals.
Bodily Injury or Death to The Third-Party
If your insured bike injures someone, causes permanent disability, or death happens to a third-party, then this insurance policy offers compensation to them or their families. In case of an injury, the medical expenses can be covered. And if permanent disability or death happens, then the compensation happens according to the terms of the policy.
Personal Accident Cover
Typically, third-party bike insurance also provides personal accident cover to safeguard you against medical emergencies.
Should You Buy Third-Party Bike Insurance or Comprehensive Bike Insurance?
Third-party two-wheeler insurance covers the cost of damages or injuries that happened to a third-party individual or their property. It does not provide coverage to the bike owner or rider. Here, the insurance company covers the medical expenses or damages incurred due to the accident.
On the other hand, comprehensive bike insurance offers all-round protection to you, your bike, and third-party liabilities. It covers your bike against thefts or damages while also offering a personal accident cover for yourself.
When to Choose Third-Party Bike Insurance:
- If you are primarily looking to meet the legal requirements
- If you are looking for a more cost-effective option
- If your bike is old or has a low market value
- If you do not use your bike frequently
When to Choose Comprehensive Bike Insurance:
- If you are looking for an extensive coverage
- If you own a new or high-value bike
- If you wish to enhance your coverage with add-ons
- If you use your bike regularly
Conclusion
While third-party bike insurance is necessary for legal compliance, it offers basic protection and lacks the comprehensive coverage needed to fully protect yourself or the bike. Hence, choosing between third-party bike insurance and comprehensive bike insurance depends on your specific needs, budget, and the value of your bike.
