Among the most popular two-wheeler insurance plans, third-party and comprehensive coverages are sought the most. Essentially, with a third-party liability cover, one must purchase it as per the Motor Vehicles Act 1988. Nevertheless, one also needs own damage insurance for bikes, which covers financial losses arising out of the bike’s build and component damage in case of accidents or other road incidents. When choosing between the different types of bike insurance policies, it is best to understand their scopes of coverage and the different benefits they bring to the table for the policyholder.

Here’s a detailed elucidation of the meanings of third-party and comprehensive bike insurance policies, along with the essential points of difference that separate them.

Third-Party Two-Wheeler Insurance Policy - What is It?

A two-wheeler insurance policy for third-party liabilities is a coverage option that provides for financial losses the policyholder has to suffer when a third party claims liability. For instance, if an insured bike is involved in an accident where a third party sustains personal or vehicle damage or loss, such a loss will be covered by the policy. Since there are no limits to the sum assured, all the verified liabilities claimed by a third party shall be compensated under the policy.

However, a third-party bike insurance policy does not provide an own damage insurance for bikes in case the insured vehicle suffers damage due to such an accident. In such scenarios, the bike owner will have to rely on an own damage bike insurance policy or a comprehensive bike cover that includes own damage coverage benefits.

What is a Comprehensive Two-Wheeler Insurance Policy?

A comprehensive two-wheeler insurance policy is a type of plan that provides coverage for both third-party liabilities and own damages. With a comprehensive cover, you would thus not need to purchase a third-party liability and an own damage insurance for the bike separately.

Along with third-party liabilities, these insurance plans also provide for various damages that the bike may sustain under different circumstances. These damages can include the likes of damage from natural calamities, man-made disasters, accidental damages while driving or as a result of collision or even complete loss of the vehicle.

Differences Between Comprehensive and Third-Party Two-Wheeler Insurance Plans

When assessing the differences between a comprehensive and a third-party cover for bikes, below are the essential aspects to know.

1. Extent of coverage: The extent of coverage for a third-party bike insurance policy is limited to third party liabilities created only. Under a comprehensive cover, however, the benefits extend to own damage insurance for bikes as well along with third-party liabilities coverage.
2. Availability of add-ons: There are no add-on coverage options available under third-party bike insurance policies. Whereas, under a comprehensive cover, you can choose from a number of insurance add-ons to extend the coverage of limits of your policy.
3. Premium cost: The premiums for third-party bike covers are fixed and vary only with the engine capacity of certain bike models. In case of comprehensive covers, however, the premium varies based on the coverage benefits available and the sum insured chosen for the bike, among other pertinent factors.
4. Legality: While a third-party bike insurance policy is mandated by law for all bikes, there is no such requirement for own damage bike insurance coverage under a comprehensive plan. Nevertheless, it can always be wise to include an own damage cover in your bike insurance policy for enhanced financial protection.
5. Exclusions to the policy: Under a third-party cover, all damages of personal nature and damages sustained by the bike are excluded from policy benefits. For a comprehensive policy, exclusions mostly relate to specified scenarios like intoxicated driving, driving without licence, disobeying traffic rules, etc.

Now that you are well aware of the differences between the two policies and the extent of own damage insurance for bikes that they provide, it should be easy to decide between the two. Note that if you already had a bike cover and need to renew it, you must do so before the previous coverage expires. Timely renewal of bike insurance ensures that your bike does not run out of coverage anytime and adheres to the coverage rules. Also, continued coverage for the vehicle allows the policyholder to utilise accumulated benefits like NCB to reduce the premium cost of policy renewal.