How can IDV and NCB benefit your two-wheeler 07th July 2021
Understanding that two-wheeler insurance is as important as your health insurance because your vehicle needs coverage and security too, is very important. Not having insurance coverage leaves you vulnerable to financial damages during unfortunate accidents. But with insurance and its premium, there comes two more necessary factors, IDV and NCB.
If you are a first-time insurance buyer, then understanding IDV and NCB will help you decide on better insurance for your two-wheeler. Let's understand them and their benefits in detail.
Insured Declared Value (IDV) tells the actual market value of your two-wheeler. It's the highest sum of the amount insured that your insurance provider has promised to you. In case of theft, accident, or total loss of the vehicle, you will get compensation as per the IDV of your two-wheeler. Likewise, you can claim it in case of damage or replacement cost of your two-wheeler.
Two-wheeler is a tangible asset that doesn't always stay new. Hence, its value depreciates over the period, and as it becomes older, its premium amount also gets lesser. As a result, the IDV also reduces.
Never declare lower IDV than your bike's current market value to get a lower insurance premium. In case of any bike theft or total damage, your claim amount will be relatively much lower, thus making a significant loss to you.
No-Claim Bonus (NCB) is the total accumulated amount yearly. As its name suggests, it is a reward that the policyholder gets during insurance renewal for the two-wheeler. This bonus is offered in the form of a concession of the premium paid on insurance by you.
Below are the points why IDV and NCB play an essential part in determining your vehicle's insurance premium:
1. If you want to conserve your benefits of NCB, but unfortunately, meet with some mishaps, then you stand no chance to claim your bonus. A 'protection cover' can be helpful for such situations, which you can add to your NCB. It is nearly 10% of your premium amount. Though the number of claims are limited, this still helps to conserve your NCB bonus.
2. The main advantage of NCB is that it is more beneficial to the policyholder, not the vehicle. For example, if you opt a NCB for a new 2-wheeler, you can transfer it from your old two-wheeler to the new vehicle.
3. Your IDV mainly depends on the age of the vehicle. The other factor in deciding on IDV is the condition of your two-wheeler. So, it is crucial to evaluate IDV correctly, which further helps you with better insurance with a suitable premium.
4. When you opt for renewing your 2-wheeler insurance online, keep in mind that your premium depends on IDV. Lesser the age of the bike means higher IDV and higher premium.
As a final piece of advice, if you want to save more on insurance, then declare the correct IDV of your vehicle and get the benefit of your NCB. Both NCB and IDV balance your insurance premium and the cover to your two-wheeler.
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