If you have your two-wheeler insured under a bike insurance policy, insurers cover you financially during unprecedented mishaps. They assist you in fulfilling liabilities if your bike affects others with a third-party insurance policy. For protecting your vehicle and avail of additional benefits, you can upgrade to a comprehensive plan. In both cases, the claim amount is disbursed up to a limit, while the remaining portion goes from your pocket. This is termed as deductible. It is categorised as compulsory and voluntary deductible in bike insurance. Continue reading to learn more about it.

How does deductible in bike insurance work?

The insurer pays the compensation when you file a claim after you contribute the deductible amount. In the case of a voluntary deductible, you get to choose the amount based on your preference and financial capacity. On the other hand, a compulsory deductible is predetermined by the insurance companies. They charge it to reduce the number of unnecessary claims and protect their interests.

Let's take an example to understand how deductible works. Assume you are required to pay ₹100 as the compulsory deductible in two-wheeler insurance. If the total cost of the claim amount is ₹2,000, the insurer will compensate with ₹1,900, while you contribute ₹100.

Facts to know about compulsory deductible in bike insurance

Here are some facts you should consider to better understand compulsory deductible:

Fixed amount:

Insurance companies set the compulsory deductible based on the regulations of the Insurance Regulatory and Development Authority of India (IRDAI). Once fixed, the amount is not customisable and applies to every claim filed throughout the policy period.

Payable after approval:

Insurers process the compulsory deductible in two-wheeler insurance only after the claim request is approved. Hence, the first priority is filing the claim, and you can pay the deductible amount after receiving the approval confirmation.

Does not affect premium:

When you opt for voluntary deductible, the insurance company rewards your choice with a concession on the premium amount. But compulsory deductible is pre-set clause. Hence, it does not have any impact on the premium.

Voluntary deductible ≠ no compulsory deductible:

You have the choice to opt for voluntary deductible but choosing it does not substitute compulsory deductible. You still have to pay the mandatory deductible along with the voluntary deductible amount you select.

Not the same as co-pay:

Although both co-pay and compulsory deductible are mandatorily deducted during a claim, they differ in nature. Co-pay is the percentage of the claim you agree to pay from your pocket. Contrarily, a compulsory deductible is a pre-decided fixed amount that you pay regardless of the claim amount. Also, co-pay is mostly applicable on health insurance.

Invest in bike insurance

Learning about compulsory deductible is important to have clear expectations about the compensation you receive during a claim. It also helps you prepare financially for your share of the contribution. Hence, you should go through the compulsory deductible clause when you buy bike insurance online. Once you have complete clarity, you can proceed to make an informed buying decision.

Disclaimer: The above information is indicative in nature. For more details on the risk factor, terms and conditions, please refer to the Sales Brochure and Policy Wordings carefully before concluding a sale.