Motor Insurance Glossary

Types of Bike Insurance Claims

Bike insurance claim process is classified on the basis of either mode of payment or the types of claim.

Types of Bike Insurance Claims based on Payment Process:
  • Accident

    Any Unforeseen and unexpected event is considered an accident. For insurance purposes it should be due to external, physical and violent means.

  • Break In

    A comprehensive policy that has expired and the customer propose to seek insurance for the same vehicle is a break-in policy.

  • Cancellation

    Insured can at any given point of time during the currency of policy can cancel the policy and can get the refund of premium on short period scale basis by a providing a notice of 7 days before the date of such cancellation. Insurer can also opt for cancellation, firstly a notice needs to be provided and the refund of premium is based on pro-rata basis.

  • Certificate of Insurance

    This is a document evidencing that a motor vehicle is insured against TP liability as required under the Motor Vehicle Act, 1988.

  • Comprehensive Motor Insurance

    A kind of policy where in the coverage is provided both for Third Party liability as well own damage to the motor vehicle.

  • Cover Note

    A cover note is a temporary insurance certificate that is issued before the actual policy is issued to the insured, only after he has paid the premium for the insurance.

  • Coverage

    The scope of protection provided under a contract of insurance; any of several risks covered by a policy.

  • Deductibles

    It is generally the amount that is to be borne by the insurer for any claims arising under the policy, this arrangement is made by the insurer as to avoid frequent small claims.

  • Depreciation

    A decrease in the value of property over a period of time due to wear and tear or adolescence. Depreciation is used to determine the actual cash value of property at time of loss.

  • Endorsement

    It is the document which incorporates change or alteration in the existing policy. Endorsement is a duly signed written document which is attached with the policy document. An endorsement might or might not attract an additional premium.

  • Exclusion

    These are conditions and perils which are generally not covered under the policy. No claim is provided on operation of such perils.

  • Franchise

    These are conditions and perils which are generally not covered under the policy. No claim is provided on operation of such perils.

  • Insured Declared Value

    It is the value for which the motor insurance is provided for. Such value is obtained from the seller’s price after providing the appropriate depreciation to the value. It also includes the cost of accessories installed in the vehicle. Depreciation is provided as per table specified by the India Motor Tariff

  • Insured

    One who buys and holds the insurance.

  • Insurer

    One who provides the insurance.

  • Liability Only Policy

    It is a discount offered by the insured on renewal if there has been no claim during the previous policy period, it increase every year. The discount so provided is on Own damage premium. The discount is capped at 50% of the total OD premium.

  • Own Damage

    Damages which happens to the insured vehicle during an accident.

  • Owner Driver

    A person owning a car and holding the driving license is known as owner driver.

  • Partial Disability

    If due to an accident, the insured person due to injury is not able to do one or more of his work, then such a disability is known as partial disability. It can be permanent and temporary as well.

  • Personal Accident Claims

    If due to an accident, injury or death of the owner driver or the co passengers happens and claim arises, then such claims are known as personal accident claims.

  • Policy Period

    It is the period for which the insurance is active. Motor insurance generally used to be of yearly basis but now a day’s some insurers have started providing it for more than a year. This period is mentioned on the insurance policy.

  • Policy Schedule

    It actually is the policy; it contains all the information regarding the insurance opted for such as period of insurance, what is covered and what is not covered.

  • Preferred Garages

    Garages which are tied up with the insurance companies to provide quick and easy assistance. Such garages provide cashless facilities for the repairs.

  • Private Car

    A car which is used only for personal use.

  • Proposal Form

    It is a document which is required to be filled by the proposer of the insurance; it seeks the basic information about the proposer and about the vehicle which is being insured under the motor insurance.

  • Renewal

    It is said as the repurchase of the insurance when the previous one is expired or is generally purchased before the expiry.

  • Roadside Assistance

    During the happening of an accident while the vehicle is on road and away from the city lines, motor insurance provides for variety of assistance to the insured vehicle as well as to the insured.

  • Salvage

    In general terms it is the damaged vehicle which is beyond repair and in return of claim is given to the insurer.

  • Sum Insured

    It is the limit of liability of the insurer under the policy for a given period of time.

  • Third Party Claims

    A demand made by a person against a policyholder and any payment that will be made by the company

  • Third Party Property Damage

    It is damage to the property of the third party by using an insured vehicle. Property can be anything holding any value. The limit for such damage is 7,50,000 for four wheelers and 1,00,000 for two wheelers.

  • Total Loss

    The complete loss or destruction of the motor vehicle insured under the policy.

  • Total Theft Claims

    It is claim for the vehicles which are stolen.

  • Zero Depreciation

    It is an additional cover under which, if opted for then the insured won’t be charged the cost of depreciation on parts which otherwise would get deducted from the final claim amount and required to be borne by the insured himself. Although it is applicable only for partial loss claims.

Standard Deductions in a Bike Insurance claim

Against popular belief, the entire cost of your loss or repairs is not borne by the Insurance Company. There is something called as a �deductible� or �excess� which is the amount the vehicle owner needs to pay from his own pocket whenever there is a motor insurance claim. The deductible has two types, compulsory deductible and voluntary deductible.

  • Compulsory Deductible

    It is the specific amount pre-fixed by the Insurance Company which the policyholder has to pay regardless of the claim amount. A high compulsory deductible forces the owner to be more cautious, as in the event of a claim he will have to pay a higher amount.

  • Voluntary Deductible

    If the policyholder wishes to receive a discount on the policy premium, he can opt to pay an amount over and above the compulsory deductible. The policyholder is basically rewarded with a discount for sharing the cost of the repairs. For instance, if you choose to pay a voluntary deductible of 4000 Rs, you receive a discount of 20%-30% on your policy premium. However, please note that you need to pay the voluntary deductible in addition to the compulsory deductible.

  • Depreciation:

    Depreciation of vehicle parts affects the claim amount. Which means, the payment is made on the basis of the current value of your vehicle parts and not the value of new parts. This deduction can be ignored if you opt for a zero-depreciation cover.

  • Consumables

    The consumables of your bike such as engine oil, coolant, fuel etc is not covered by your bike insurance policy. However, an add-cover of consumables takes care of this problem if you are willing to pay slightly additional premium.

Major Exclusions in a Bike Insurance policy

Before proceeding with your bike insurance claim it is important that we understand the limitations and exclusions of our policy. Hence, the following are the exclusions of a Bike insurance policy:

  • General wear and tear of the vehicle and normal ageing
  • Any Mechanical or Electrical breakdown
  • Loss or damage because of war, nuclear risk or mutiny
  • Damage to the vehicle because of driving under the influence of alcohol, drugs or any other intoxicant
  • Non compliance of the manufacturer guidelines
  • Depreciation of the vehicle and any consequential loss
  • Damage or loss outside the policy period

As per recent statistics, in our country a shocking 400 people die in road mishaps every single day. This simply highlights the importance of the safety net of a bike insurance policy. However, purchasing bike insurance is one thing and claiming compensation from the insurance company is a whole different ball game. It�s a scenario you should always be prepared for. You need to be certain of the steps to be taken to receive a satisfactory settlement from the insurer. In order to do so you should always be aware of the pitfalls that can put your claim amount at risk. Therefore, it is crucial to understand the Do�s and Don�ts of bike insurance claims.

  • What to Do while filling a Bike Insurance Claim

    The following is the list:

    • Do inform your insurer within 48-72 hours of the incident as there is a time-limit for the claim intimation
    • Do collect evidence about the incident by taking photographs and noting down names and addresses of witnesses
    • Do maintain a separate file containing all the payment receipts and documentation related to the claim such as garage bill, medical bill etc
    • Do stay honest with the Insurance company at all times and furnish them with real details of the incident
    • Do keep a record of all the communications with the insurance company. Write down even verbal communication as it can be useful in the future
    • Do go through your policy in detail to understand the different coverage and be in a better position to negotiate a claim settlement
    • Do consult your attorney if you disagree with the claim assessment of your insurer
  • What Not to Do while filling a Bike Insurance Claim

    The following is the list:

    • Don�t plead guilty to the accident. An accident is affected by a number of factors and it is quite possible that something else caused the accident. If you take responsibility, your claim settlement is jeopardized even when the accident was not your fault.
    • Don�t run away from the scene of the accident. It establishes that you are at fault
    • Don�t avoid informing the cops. The FIR can be handy in the claim process
    • Don�t sign any agreement until you are absolutely certain. If you have even the slightest doubt consult an expert
    • Don�t accept the settlement if you are not happy with the amount
    • Don�t surmise that the estimate of the claim surveyor is final. Do your own research and take an attorney help to negotiate the estimate
    • Don�t lose your temper. A stressful situation like this can get the better of anyone. Hence, stay calm and avoid being violent with the other party
Myths related to Bike insurance claims

Let us bust a few common myths related to Bike Insurance claims to improve our understanding about the claim process:

  1. A Bike insurance policy provides protection only against accidents: A comprehensive bike insurance policy apart from accidents covers your bike from damages and loss because of:
    1. Natural calamities such earthquake, lightening, flood, cyclone etc
    2. Man-made events such as theft, riots, fire, strikes, and other malicious activities
  2. If your friend is driving your bike, your claim will be rejected: As long as your friend was driving with a valid license your claim will not be rejected. However, in case of any injury or death of your friend, the policy can�t come to your rescue as the personal accident clause is mapped to your name.
  3. Bike modifications have no effect on insurance: The price of your bike as well as its safety will be altered with modifications. Hence, you need to inform your insurance company in case you wish to modify your bike. If you have not intimated them, your claim can easily be rejected on this ground.
  4. You have to pay from your own pocket even after opting for Insurance: This one is partially true. Even with insurance, a certain portion called compulsory deductible has to be paid by the policyholder. However, you will have to pay the entire garage bill if you don�t have insurance.
  5. Bike Insurance does not cover "Act of God": Against popular belief, bike insurance covers for a lot of natural calamities such as earthquake, flood, cyclone, lightening etc