Finance

Things to remember about bike insurance while buying a used bike

Depending on public conveyance when you are in a rush can be extremely cumbersome. This is the reason why the demand for two-wheelers is constantly rising in India.Today, bikes have emerged as one of the best modes of daily commute. Moreover, bikes are more affordable than cars, especially if you are not keen on investing substantially. Also, instead of brand new two-wheelers, you can go for second-hand two-wheelers that are efficient yet more cost-effective. These are also apt for those who are learning to ride a bike for the first time and are worried about incurring damages on a new bike.

If you are planning to buy a used bike, you not only have to carefully analyze the condition of the bike and genuineness of the seller but also have to check paperwork, including Bike Insurance. This is because an insurance policy can protect you against on-road emergencies like traffic collision, theft etc. Here are the things to remember about bike insurance when you are buying a used bike.

Valid insurance: First and foremost, check whether the bike has valid insurance or not. Though third-party insurance is mandatory by law but sometimes people do not follow the law. Other than third party insurance, comprehensive insurance is also recommended because it covers vehicle damage against natural and man-made disasters. If the insurance is not valid, you have to get valid insurance for the bike. It is important to keep your bike insured at all times because it not just a legal obligations, but also secures you financially in case of an accident that causes damage to a third partyperson or property.

Transfer of insurance papers: Vehicle insurance is mandatory, as without insurance, a vehicle cannot be registered in the RTO. When you are buying a used bike,make sure that the seller provides insurance papers of the bike. Most buyers make the mistake of forgetting to transfer the insurance policy to their name under the said circumstances. Make sure to transfer the policy from the old bike owner to your name,or else take a new policy within the permissible time window to avoid the penalties.

In case, the bike you are purchasing has a valid insurance policy, then the insurance company which has provided the policy will transfer the ownership from seller to buyer. To transfer the insurance policy, the seller needs to inform the insurance provider about the sale of the vehicle. At the time of transfer, no claim bonus remains on the seller’s name, and it cannot be transferred to the buyer of the vehicle. With no claim bonus certificate, the seller can avail a considerable discount on the next motor insurance.

The buyer also has to approach the insurance provider to update the personal details of the existing policy. At last, you have to inform the RTO about the transfer of ownership of the vehicle.  If the insurance policy is not activated at the time of buying the two-wheeler, you have to buy a new insurance policy.

Check the expiry of the insurance:If the old insurance has expired, you need to buy a new insurance cover which will increase the cost of getting the bike. You can always ask the seller to get the insurance done in the same deal or cut down the price of the vehicle in case the insurance has expired or is on the verge of renewal. If the bike is insured, make sure to transfer the policy to your name, as mentioned above.

Check Insured Declared Value (IDV): Insured Declared Value is the maximum sum assured agreed upon by the insurance provider, and it is to be reimbursed to the bike owner and policyholder in the event of bike theft or total loss. As the insurance premium is directly proportional to the IDV, if the IDV is low the insurance premium will also be low.

Check the personal details mentioned in the policy: For a valid renewal or transfer of the insurance policy, personal details mentioned in the policy and RC should be same. Even if it seems like a simple point,make sure that you pay it due attention,since if the insured’s name is not the same as other records such as on the RC and previous policy documents, the policy will standinvalid. Not mentioning the correct personal details is also a fraud. If you file a claim under these circumstances, it may not get legally processed by the insurance provider.And you may also lose the insurance cover. To avoid hassles in the future, do not forget to double check the personal detail section.

Buying a second-hand bike is a lucrative option as it can cater to your needs at an attractive price. However, do pay a little attention to the insurance policy while buying a used bike to avoid future complications.

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