When it comes to riding bikes, insurance becomes an important aspect. For any bike owner, bike insurance becomes a critical issue and represents a decisive component. While it is not truly mandatory to have third party insurance, anyone who wishes to get third party motorbike insurance requires you to pay a year’s amount. To know about third party bike insurance, you need to click here,
What are the third party rules?
The Insurance Regulatory and Development Authority has already declared the new third party insurance policy. It clearly says, if the bike rider moves on the road without a third party bike insurance policy, then one needs to pay several premiums for numerous years. The rule was started on 1st September 2018.
There are some rules which have not been changed and some rules which have been changed. All those changes and non-changes are mentioned below.
Which of the insurance rules remains the same?
It is seen that some of the rules of bike insurance did not make any categorical difference and remain the same.
Renewal of the old policies
The renewal policies for vehicle owners will remain the same, and the rules will only apply for the bikers who have purchased the bikes after 2018. The third-party insurance rules will be levied on them and not on those who already have long term insurance policies.
The declared value of insurer
Since the bikes brought before September 2018 are already covered by the insurance, the new rules will not make a difference on the insured declared value.
No claim bonus
When it comes to new rules related to third-party bike insurance, no changes will be affected in the no claim bonus.
Things that have changed
There are some convincing changes in a third-party insurance policy, as the new rules do not make any difference on IDV, renewal policies and no claim bonus.
While the premium outflow in the 1st year will sharply increase in contrast to premium payments before the last year, the new rules demand the lump – sum amount that must be paid within 3 to 5 years. In the second and third year, one does not have to pay any premiums.
Tariffs for the third party
The tariffs have gone up for motorcycles with engine capacity of less than 1000cc. The new tariff rates will be applicable to all bikes that have capacities of more than 1000cc, while it is seen that most of the bikes in the Indian market are less than1000 cc.
For vehicles not superseding 1000cc:
The premium rates remain the same, for all the motor vehicles with engine capacity of less than 1000 cc. From the cumulative amount in the old scheme, the new rate of INR 5286 will be less than INR 5550.
For the vehicles not exceeding 1500cc and exceeding 1000cc:
As per the new long term payment policy, motorbikers need to pay more, compared to the earlier cumulative amount.
For motorbikes Over 1500 CC
As per rules, the new premium amounts for the motorbikes over 1500 CC will be more, in contrast to the previous cumulative premiums, which the bikers need to pay previously.
Impact on the premium outflow
Instead of annual payments, the net outflow will be more in the first year. It is a significant change, which has been announced for the third party bike insurance policy. The premium is fixed by IRDA, as per new rules.
While there is no premium to be paid in the second and third year, the outline has only increased in the first year. It is a significant change for the bike riders, who can now surely breathe a sigh of relief in the coming years.