Know Why Bike Insurance is More Expensive Than Car Insurance


04 Aug 2023

Here are the various factors to know why bike insurance is more expensive than car insurance. Check out the bike & car insurance policy from Kotak General Insurance.

If you have both bike and car insurance, you will notice that the premium you pay for the former is often more costly than the latter. Even as cars are more expensive, the risk of riding a bike is higher than cars. Moreover, the number of bike accidents in India is more common than car accidents. Let’s explore more about these two vehicle insurances and why bike insurance is relatively more expensive.

How is two-wheeler insurance different from car insurance?

For both vehicles, the type of insurance covers offered by the issuers is the same, but the policies for two-wheeler and four-wheeler vehicles differ considering the following factors:

• Passenger cover:

A bike insurance policy only provides coverage for the rider. For the safety of the pillion, you need to buy a passenger cover. On the other hand, a basic car insurance policy covers all the passengers and needs not to be purchased separately.

• Add-on cover:

Optional cover such as personal accidents for co-passengers needs to be bought additionally by bike insurance policyholders to ensure the safety of the passengers. In the case of car insurance, owners can opt for various add-ons to improve the policy coverage.

Why is bike insurance more expensive than car insurance?

When you compare the cost of bike insurance to the cost of bike, the value of the premium is higher for a two-wheeler than a car insurance. The reason is the high probability of bike accidents than car accidents.

Factors that affect the bike insurance premiums

The bike insurance premium is evaluated on the basis of various factors; these include:

• Third-party cover:

It is compulsory to have third-party insurance. If you plan to upgrade the policy to a comprehensive insurance policy, the premium rate increases but has a wider coverage as it provides coverage for third party liability and own damage insurance.

• Age of the bike:

If the vehicle is old, the risk of theft is less, and so is the value of the bike. Considering this, the premiums would also be low.

• Make and model:

A higher value bike would obviously have a higher premium rate. If you have a luxury bike, you will need insurance that protects you and your bike against all sorts of risks. This also increases the premium.

• Passenger cover:

When you are riding a bike, co-passenger safety is also crucial. A passenger cover includes the expenses related to the bodily injuries for the rider and pillion.

• Add-on covers:

The bike insurance policy premium will be more if you select any add-on cover. These are available at an additional cost.

What are ways to reduce bike insurance premiums?

• Avoid small claims: To reduce the bike insurance premium, it is advisable to avoid raising claims if there is a small dent or scratch on the vehicle.

• No Claim Bonus (NCB): This feature offers a premium discount. If you have an NCB, the premium gets reduced at the time of policy renewal.

• Higher Volantary deductibles: Whenever there is a damage to your vehicle, the insurance company will be liable to cover a part of the expenses, and you will pay the rest. The amount you pay is voluntary deductibles that you choose when buying the insurance policy. Opting for higher deductibles reduces the premium amount.

• Renew policy on time: Renewing policy on time saves you from the hassle of buying a new policy, which in turn increases the overall cost of the premium.

Final Word

Even though the insurance companies offer third-party liability & comprehensive insurance cover for two-wheeler and four-wheeler vehicles, it is essential to check the term and conditions. You can buy Kotak Long term two wheeler secure bike insurance policy that provides you with own damage insurance, third party liability insurance and personal accident cover for the owner or the driver to up to 15 lakhs.

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Team Kotak GIC

The content of this blog has been created and carefully reviewed by the esteemed team at Kotak General Insurance, with the sole purpose of providing valuable guidance and sharing insights on the importance of general insurance. Our objective is to assist users in making informed decisions when purchasing or renewing insurance policies for their cars, bikes, and health. Our expertly curated information aims to empower our readers with the knowledge they need to protect their valuable assets and financial interests.