In 2020, the worldwide two-wheeler insurance industry was valued at $91.6 billion and is expected to grow to $171.88 billion by 2030 (Allied Market Research). With so many kinds of insurance coverage offered in the market, it might be confusing if you’re purchasing 2 wheeler insurance in India for the first time. In addition to mandatory insurance plans such as third-party liability and comprehensive insurance, you can choose from a selection of top-up covers or riders to assist you to cover a broad range of risks. These add-ons include Key Replacement, Quick Road Assistance, Return to Invoice, No Claim Bonus (NCB) Protection, and more.
This article will discuss the two most important add-ons of a bike insurance policy- Zero Depreciation and NCB.
What is a Zero Depreciation Bike Insurance Cover?
One of the most prominent add-ons covers for two-wheeler insurance is Zero Depreciation, commonly referred to as “nil depreciation.” Both the standalone and comprehensive bike insurance policies provide the option for zero depreciation add-on coverage. It covers all components of your two-wheeler for 100% depreciation, excluding tires, batteries, and tubes, which are insured at 50%. Most insurance companies only permit 2 zero depreciation claims throughout the policy term; however, there are few exceptions that provide an endless number of claims.
When Should You Go for a Zero Depreciation Cover?
People who have just bought a bike or are new to riding are the perfect candidates for the Zero Depreciation Cover. Additionally, NIL Depreciation cover is required if you own a high-end two-wheeler since the parts and accessories for these vehicles are costly to repair or replace. A Zero Depreciation Cover might be beneficial for any bike rider, especially in India, which records the largest incidence of accidents on the roads.
Advantages of Zero Depreciation Bike Insurance Cover
Following are some advantages of a two-wheeler insurance plan with zero depreciation coverage:
- Greater Compensation: The IDV of the bike insurance policy determines the maximum amount of claim you are eligible to obtain for your bike. The depreciation rate applicable to the bike parts directly affects the compensation amount. As a result, with the zero-depreciation cover, you may make claims without being impacted by the bike’s depreciation rate, allowing you to get a more considerable claim amount.
- Enhances Coverage: The standard coverage of your two-wheeler insurance is enhanced by a zero-depreciation add-on cover, which almost eliminates your costs to zero. You get a higher claim amount by paying a small price for the add-on cover, which also increases your savings.
- Increased Claim Amount: Before approving the claim amount, the insurance provider will review the depreciation rate applicable to various parts of your two-wheeler. Different parts of a bike depreciate at different rates, and claim rates are also determined by the age of your two-wheeler.
- Multiply Savings: Although the cost for a zero-depreciation add-on cover is a bit more, the fact that there will be no depreciation applicable to your bike in the event of an accident or mishap and that the claim value will be computed without Depreciation will allow you to get higher compensation. Since the compensation you get with this cover often exceeds its price, you save a lot more money.
- Repair Cost Excluding Depreciation: Depreciation value is not taken into consideration when calculating any costs that could be associated with repairs to your bike’s insured parts.
What is a No Claim Bonus Cover?
The term “NCB” or “No Claim Bonus” refers to a bonus provided to the owner of comprehensive bike insurance for each year without a claim. The insurance provider gives you a rebate, referred to as a No Claim Bonus, or NCB, in exchange for taking excellent care of your bike and not incurring liability on them. If you do not make any claims, you might get up to a 50% discount on your bike insurance. This is accessible if you have not submitted a claim in the past five years. NCB accumulated over time might significantly boost your sum insured.
You can claim your NCB at the time of renewing your bike insurance.
Significance of NCB in Bike Insurance
The NCB or No Claim Bonus is very crucial to bike insurance. When people renew their two-wheeler insurance either online or offline, they can take advantage of this benefit for driving safely. Insurance companies use this kind of incentive to encourage drivers to be cautious when riding or driving on the roads. The main benefit of NCB in bike insurance is that it gradually lowers your insurance premium, which reduces your monthly or annual expenses. As a result, you pay less for insurance while receiving more coverage. What could be more rewarding than driving safely while receiving high insurance with reduced premiums?
The Advantages of No Claim Bonus in Bike Insurance
Following are some advantages of No Claim Bonus in bike insurance:
- Hold NCB: The policyholder may keep the No claim bonus on their bike as long as they don’t file a claim throughout the plan’s term.
- Lowers Premium: If the policyholder doesn’t make a claim during the duration of the insurance policy, the NCB acquired can be utilized as a discount when paying the premium for a bike insurance policy renewal.
- Option to Transfer: Since the NCB is an exclusive property, it can be transferred to another insurer if the policyholder chooses not to file a claim. You can use the No Claim Bonus privileges when renewing your two-wheeler insurance policy.
- Furnishes Rewards: NCB is used to reward the policyholder for safe driving and not making a claim throughout the term of the policy. It is offered as a discount to encourage policyholders to ride their bikes responsibly on the road.
Extra Savings with NCB & Zero Depreciation!
Both these covers are an indispensable part of an effective bike insurance policy. Zero Depreciation guarantees long-term savings. A zero-depreciation cover is a lucrative choice providing you with both benefits and efficient features. At the same time, a No-claim bonus is vital in lowering the cost of a two-wheeler insurance premium (OD Premium amount). As the NCB cover might significantly reduce your OD rates, it is a wonderful approach to keep the premium amount under control during your vehicle insurance renewal. So, what’s stopping you? Get these add-on covers this instant.
Disclaimer: The above information is for illustrative purposes only. For more details, please refer to policy wordings and prospectus before concluding the sales.
