Owning a bike in India is a source of pride and convenience for many. However, selecting the most suitable bike insurance can be difficult. Understanding various types of insurance and selecting the right one is important to safeguard your vehicle and ensure peace of mind. Instead of continuing to ride your bike without insurance, it is better to buy at least third-party bike insurance.
Despite its importance, many people are unsure about how to protect their bikes with two-wheeler third-party insurance. A statistic highlighting the necessity of third-party bike insurance says that two-wheelers accounted for around 41% of total deaths in accidents on National Highways in 2022, accounting for a significant proportion of road mishaps. This underscores the importance of having third-party insurance to cover potential liabilities.
Whether you are a new bike owner or looking to renew your policy, let us help you understand third-party bike insurance so you can stay protected on the road.
What is Third-Party Bike Insurance?
Third-party bike insurance, also known as liability-only insurance, is a type of motor insurance coverage mandated by Indian law for all two-wheeler owners. It is designed to protect you from financial liabilities related to damages or injuries caused to a third party due to an accident involving your bike. Unlike comprehensive insurance, which covers both own damage and third-party liabilities, third-party insurance only focuses on covering the costs associated with harm done to others. It is generally more affordable than comprehensive policies but provides a basic level of protection only.
You should also know that:
- This type of insurance policy covers the legal and financial liabilities if your bike causes injury or death to another person. It also covers damage to third-party property.
- According to the Motor Vehicles Act of 1988, it is illegal to ride a bike in India without at least third-party insurance. Non-compliance to these rules can result in hefty fines and legal repercussions.
How Does Third-Party Bike Insurance Work?
Here’s a breakdown of how this type of insurance operates:
When you purchase third-party bike insurance, you pay a premium to the insurance company.
If you are involved in an accident where your bike causes damage to another person, their vehicle, or property, you need to inform your insurance company immediately. Also, provide all required details and documentation.
The insurance company will then investigate the claim, assessing the extent of damage or injury caused to the third party.
After verification, the insurance company will settle the claim by compensating the third party for their losses as per the policy terms.
In cases where legal proceedings are involved, your insurance company can provide legal assistance and represent you in court.
Keep in mind that third-party insurance does not cover any damage to your bike or personal injuries. For such coverage, you would need a comprehensive bike insurance policy.
More About the Compensation Offered Under Two-Wheeler Third Party Insurance
The Insurance Regulatory and Development Authority of India (IRDAI) governs the compensation amounts for third-party bike insurance claims. To be eligible for compensation, the bike owner must possess a valid driving license and registration certificate.
The compensation for physical injuries caused to a third party varies based on the severity of the injury. The following table outlines the compensation scale for different types of injuries under third-party bike insurance:
| Nature of Injury Caused to the Third Party | Scale of Compensation |
|---|---|
| Death | 100% |
| Loss of two limbs or sight of two eyes | 100% |
| Loss of one limb and sight of one eye | 50% |
| Permanent total disability from injuries other than those mentioned abov | 100% |
*The compensation may vary from insurer to insurer for different types of injuries. Please check with your insurer for more information.
What are the Third-Party Bike Insurance Rates?
In addition to determining compensation, the IRDAI also sets the premiums for third-party bike insurance policies based on the engine capacity of the bike. These rates are standardized to ensure consistency and fairness across the industry.
Here is a table showing the predefined 1-year third-party bike insurance premium rates based on the engine cc:
| Bike Engine Capacity (in CC) | Annual Third-party Bike Insurance Premium Rates (in ₹) |
|---|---|
| Up to 75 CC | ₹ 538 |
| Between 75 to 150 CC | ₹ 714 |
| Between 150 to 350 CC | ₹ 1,366 |
| Above 350 CC | ₹ 2,804 |
Also Read: A Complete Guide to Third-Party Insurance
What are Long-Term Third-Party Bike Insurance Rates?
The IRDAI has mandated that all general insurance companies offer long-term third-party bike insurance policies for new two-wheeler owners. New bikes must be insured with a five-year policy right from the start.
This rule change has significant benefits:
- One major advantage is that it eliminates the need for annual renewals, which bike owners often forget, leading to lapses in coverage.
- With a five-year policy, new bike owners can enjoy uninterrupted protection without the hassle of remembering yearly renewals.
The table below outlines the rates for long-term or 5-year third-party bike insurance premiums, effective from 1 June 2022:
| Bike Engine Capacity (in CC) | Third-party Bike Insurance Premium for Five years (in ₹) |
|---|---|
| Up to 75 CC | ₹ 2,901 |
| Between 75 to 150 CC | ₹ 3,851 |
| Between 150 to 350 CC | ₹ 7,365 |
| Above 350 CC | ₹ 15,117 |
How to Buy Third-Party Bike Insurance?
Whether you prefer the ease of online transactions, the traditional method of visiting an insurance office, or the assistance of insurance aggregators, getting your bike insured is easier than ever.
Steps to Buy Third-Party Insurance Online
- Visit the insurer's website. Most insurance companies have user-friendly websites where you can purchase third-party bike insurance.
- Enter necessary details about your bike, such as make, model, engine capacity, and registration number.
- Choose the third-party insurance policy that suits your needs.
- Pay the premium online using secure payment methods.
- Once the payment is successful, you will receive the insurance policy document via email instantly. You can also download it from the insurer’s website.
Steps to Buy Third-Party Bike Insurance Offline
- Visit the nearest branch office of the chosen insurance company.
- Provide necessary documents, such as your bike's registration certificate, driving license, and other required identification.
- Complete the insurance application form with accurate details.
- Pay the premium via cash, cheque, card, or online.
- The policy document will be handed over to you or mailed to your address.
Steps to Buy Third-Party Bike Insurance Via Insurance Aggregators
- Enter your bike details and compare third-party insurance policies at reputable insurance aggregator platforms.
- Select the policy that offers the best coverage and premium rate.
- Complete the purchase by paying the premium online.
- You will receive the policy document via email or mailed to your address.
To buy third-party bike insurance from RenewBuy, click here.
How to Renew Third-Party Bike Insurance?
Renewing your third-party bike insurance is simple, and you can do this through the following convenient methods, similar to the insurance-buying process:
Online Renewal
Log in to your insurer’s website.
Check and update your policy details if necessary.
Find the renewal section and proceed.
Pay the renewal premium online securely.
Get the renewed policy instantly via email or download.
Offline Renewal
Go to your insurer’s nearest branch.
Submit your policy number and required documents.
Complete the renewal form accurately.
Pay the renewal premium via cash, cheque, or card.
Collect the renewed policy document immediately.
Via Insurance Aggregators
Go to a trusted insurance aggregator’s site.
Provide your existing policy information.
Choose the renewal option and proceed.
Complete payment securely online.
Get confirmation and download the renewed policy document.
How to File a Claim Under Third-Party Bike Insurance?
Filing a claim under third-party bike insurance involves specific steps depending on whether you claim for damage caused by a third party or if you have caused damage to a third party. Here’s how you can deal with both scenarios:
Steps to File a Claim When a Third Party Caused Damage to Your Insured Bike
Take photographs of your damaged bike as visual evidence.
Note down the third party’s information responsible for the damage.
Obtain contact details of eyewitnesses present during the accident.
Inform your insurance company about the incident for guidance.
Register a First Information Report (FIR) at the nearest police station with jurisdiction over the accident spot.
File a case with the MACT with legal assistance.
Provide relevant evidence and documents in court to support your claim.
Once the court rules in your favor, the guilty party's insurer compensates you for your losses.
Steps to File a Claim On Causing Damage to a Third-Party Vehicle, Property, or Person
Contact the police to report the accident.
Take photos of the damaged vehicle or injured third party for evidence.
Gather contact and vehicle details of the affected third party.
Obtain contact details of any witnesses present at the accident scene.
Lodge an FIR at the nearest police station where the accident occurred.
Inform your bike insurance company promptly about the accident.
Provide all necessary details and documents to your insurer.
Register a case at the Motor Accidents Claims Tribunal (MACT) in your city.
Keep copies of all correspondence and case documents for reference.
The tribunal determines the compensation amount, which your insurer pays to the affected third party.
If the insurer’s payment is insufficient, settle the remaining balance directly with the third party to avoid future issues.
Which Documents Are Required for Third-Party Bike Insurance Claims?
When filing a claim under third-party bike insurance, you will need to provide specific documents to support your case. Here is a list of essential documents you will require
- Photographs as visual evidence of the damage caused to the bike
- Contact information and identification details of the third party.
- Statements from eyewitnesses present during the accident
- First Information Report filed at the police station with jurisdiction over the accident spot
- Legal documents filed at the Motor Accident Claims Tribunal Court (MACT), if applicable
- Copy of your third-party bike insurance policy
- Medical reports detailing the extent of injuries, if any
- Copies of all communication with your insurer and third party regarding the claim.
What are the Differences Between Comprehensive and Third-Party Bike Insurance?
| Parameter | Comprehensive Bike Insurance | Third-Party Bike Insurance |
|---|---|---|
| Coverage | Covers both own damages (bike repairs/replacement due to accident, theft, natural disasters) and third-party liabilities (injuries, property damage to others) | Covers only third-party liabilities (injuries, property damage to others) arising from accidents involving your bike. |
| Legal Requirement | Optional but highly recommended for comprehensive coverage | Mandatory by law for all bike owners in India |
| Cost | Higher premium due to broader coverage including own damages | Lower premium as it covers limited risks (only third-party liabilities) |
| Add-Ons | Offers additional coverage like personal accident cover, roadside assistance, zero depreciation cover, etc. | Limited to basic coverage with no add-ons typically available |
| Renewal | Typically renewed annually with options for long-term policies | Mandatory five-year policy for new bike owners with no annual renewals required |
| Claim Process | Claims can be filed for both own damages and third-party liabilities separately | Claims only applicable for third-party liabilities; own damages are not covered |
| Usage | Suitable for bike owners looking for extensive coverage against various risks and damages | Suitable for budget-conscious bike owners meeting legal requirements with basic coverage |
| Example Scenario | Comprehensive insurance covers repairs to your bike and medical expenses for injuries in an accident, as well as damages to another person's vehicle. | Third-party insurance covers damages you cause to another person's vehicle or injuries to others, but not your bike or injuries. |