Understanding Bike Insurance Deductible

Understanding the Types of Bike Insurance Deductibles

Now that you have understood what deductibles are, let’s get into their types and how they can impact your claim settlement. There are two types of bike insurance deductibles:

1. Compulsory Deductibles
   As the name suggests, a compulsory deductible is the amount you have to pay to settle claims under a bike insurance policy. This amount is non-negotiable and settled by the Insurance Regulatory and Development Authority of India (IRDA). Under bike insurance policies, the amount is usually set at ₹100.
2. Voluntary Deductibles
   As opposed to a compulsory deductible, the voluntary deductible is left at your discretion. This type of deductible is optional and voluntary. You can decide the amount according to your financial plan. Choosing voluntary deductibles smartly impacts the premium you are supposed to pay every month. Remember that a lower deductible increases the monthly premium and vice versa if you agree to pay a higher amount from your pocket if there occurs a need.

Choose Bike Insurance Deductibles Smartly

Choosing bike insurance deductibles requires you to mindfully consider all aspects, including income, bike servicing costs, riding habits etc. It might sound daunting at first. So here’s a list of considerations that you must keep in mind while choosing a deductible amount:

1. Your Financial Capacity
   Opting for a voluntary deductible requires factoring in your financial capacity. This includes evaluating your income and expenses. Remember that a low premium and high deductible can become a financial burden when settling claims, so make sure to choose the amount smartly.
2. Insurance Premiums
   As discussed above, the amount you agree to pay from pocket is related to the premium. So, whether you choose a high or low deductible, the premium amount you have to pay each month will automatically change.
   
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3. Your Bike Type
   Since every bike functions differently, one insurance policy doesn’t apply to all. The type of bike you own impacts the deductibles. Many bikes need frequent services, or their repair costs are high, so it's important to know your bike type and its repair/service expenses.
4. General Riding Habits/Terrain
   The deductible you should choose depends on whether you are a frequent rider, a city rider, or a tough terrain rider.
   
   Tip: If you rarely ride your bike or live in a city with minimum traffic, you may consider choosing a higher deductible. However, for a daily commuter, the chances of an accident are higher, so choosing a lower deductible may be more beneficial.
5. Likelihood of Claim Settlement Requirements
   Another factor that you must evaluate is how likely you are to raise a claim under the bike insurance policy. If you can see your bike requiring frequent services, then a lower deductible is a reliable method or vice versa if the need for claim settlements is lower.

The Bottom Line

The smart way to opt for a bike insurance policy is to evaluate its associated factors and clauses. Deductibles under bike insurance are crucial factors that affect your premium, financial planning, and ease of settling claims without any financial burden.

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