Understanding IDV and NCB in two-wheeler insurance

For most Indian families, a two-wheeler provides unlimited freedom. It allows them to commute without relying on public transport schedules or colleagues and friends. Almost every Indian family owns at least one two-wheeler to make everyday trips more convenient. The best way to safeguard these vehicles and your wallet is by opting for comprehensive two-wheeler insurance. The plan meets your legal third-party liability requirements and provides enhanced coverage. However, understanding all the terms used while purchasing and renewing insurance plans can seem overwhelming. Here’s our guide to understanding your Insured Declared Value (IDV) and No Claim Bonus (NCB) to help you make the most of your insurance policy.

While reading your policy documents, you may wonder, “What is IDV in insurance for bikes?” IDV, or Insured Declared Value, is the maximum amount an insurance company will pay due to theft or total loss of your two-wheeler. It is the sum insured and represents the market value of your bike. The IDV is a critical component in determining the premium for your insurance policy.

Let’s better understand how the IDV impacts your policy.

IDV acts as a financial safeguard. It ensures you receive adequate compensation after the total loss of your two-wheeler. It considers the brand, model, accessories and depreciation to estimate your vehicle’s current market value.

Your two-wheeler insurance premium depends on your IDV. A higher IDV usually means a higher premium. Setting a realistic IDV ensures comprehensive protection without impacting your wallet.

Understanding how the insurance company sets your IDV helps you make informed decisions about your policy. Let’s explore the factors they consider:

Your IDV takes the depreciation of your bike into account. As your vehicle ages, the market value decreases. Be mindful of the depreciation while considering the IDV.

A well-maintained two-wheeler with additional accessories will have a higher IDV than similar models.

You can check the current market price of your two-wheeler make and model. It provides a realistic benchmark for your IDV.

Say you own a popular commuter bike with an IDV of Rs. 60,000. In the night, your bike gets stolen. You lodge a police complaint and file a claim with your insurance company. Since there’s a total loss of your vehicle, they will pay the entire IDV of Rs. 60,000 as the claim amount. You can use the payout to purchase a new two-wheeler.

Now that you understand what is IDV value for bike insurance, let’s explore the benefits of having the right IDV.

The right IDV helps you get fair compensation when you file a claim against your policy.

Setting a realistic IDV helps you optimise your premium. You strike the optimum balance between coverage and cost.

Now, let’s explore what is NCB in bike insurance.

Your NCB, or No Claim Bonus, is a reward your insurance company offers when you do not file any claims during the policy term. It is a testament to your responsible riding behaviour. Your NCB provides a discount on your annual premium during policy renewal.

Let’s see how the NCB impacts you and your finances.

The NCB serves as a financial reward for safe riding practices. When you maintain a clean riding record, you avoid claims and enjoy a reduced premium in the future.

Your NCB grows and accumulates over consecutive claim-free years. The longer you go without making a claim, the higher your NCB percentage. After two or more years, you enjoy significant savings on your premium.

You can transfer your NCB from one vehicle to the next and from one insurance company to another. You can port your NCB when you switch insurance companies and carry it over to your next vehicle after you sell your current two-wheeler.

You can follow a straightforward process to check your NCB. Here’s a step-by-step guide.

Refer to your two-wheeler policy documents. The NCB percentage for each claim-free year will be listed there.

Call the customer care number for your insurance company. They can help you with your current NCB status and guide you on the applicable discount during your next policy renewal.

You can log into your insurance company’s online portal or mobile application and check your dashboard for your NCB details.

Your insurance company sends renewal notices when your policy is about to expire. Check these notices for details on your accumulated NCB percentage.

Understanding crucial terms like IDV and NCB empowers you to make informed decisions about your insurance policy. If you want a realistic IDV for your two-wheeler, consider evaluating insurance policies from Zuno. We offer comprehensive coverage that you can customise with our range of add-ons. We also provide 24x7 support and easy online renewals to ensure you always stay protected. Visit the Zuno website to explore our plans today.

ARN: Zuno/Blog/IDV and NCB in Two-wheeler insurance/12/23/08

All rights reserved.