Two Wheeler Insurance Premium

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How is Two-Wheeler Insurance Premium Calculated?

29th August 2022 8min read 356 views

Bikes are affordable and provide you with independence. As long as you have a two-wheeler, you don’t have to rely on public transport. Crucially, bikes allow you to manoeuvre through traffic snarls easily. Given the benefits, it comes as no surprise that most Indian families own at least one two-wheeler. Once you purchase a vehicle, you also need to get motor insurance. India made insurance compulsory under the Motor Vehicles Act, 1988. While buying or renewing your policy, you likely compare the premium of various plans. Let’s look at how insurance companies calculate the bike insurance premium for their offerings.

Calculating Your Two-Wheeler Insurance Premium

You can use an online bike insurance calculator to estimate your policy premium. First, you must understand what kind of policy you want. You have two options:

Third-Party Liability Only

You must have at least a third-party liability policy in India. You don’t need a two-wheeler third-party insurance premium calculator for these policies. The Insurance Regulatory and Development Authority of India (IRDAI) governs the pricing of these policies. Your bike’s engine capacity determines how much you have to pay. Let’s look at the cost of third-party policies for the Fiscal Year 2023 based on the engine capacity:

  • Capacity less than 75cc – INR 538
  • Capacity between 75cc and 150cc – INR 714
  • Capacity between 150cc and 350cc – INR 1,366
  • apacity higher than 350cc – INR 2,804

The IRDAI may revise the premiums every year at their discretion.

Comprehensive Insurance Plan

Comprehensive policies offer coverage for third-party liabilities and own damage claims. You can use an online two-wheeler insurance calculator to understand the approximate premium you have to pay for a comprehensive plan. To calculate your bike insurance premium, you need to:

  • Step 1: Find an online bike insurance calculator
  • Step 2: Input your two-wheeler’s make and model
  • Step 3: Enter your vehicle’s registration number
  • Step 4: Check the year of purchase for your bike
  • Step 5: Enter details of your No Claim Bonus (NCB), if any
  • Step 6: Let the online calculator provide you with a premium estimate
  • What Factors Determine Bike Insurance Premium?

    The bike insurance premium calculator takes the following factors into account:

    Insured Declared Value (IDV)

    The IDV refers to the maximum amount your insurer will pay in case your bike gets stolen or damaged beyond repair. Your IDV depends on your two-wheeler’s make, model and year of manufacture. Older bikes will likely have a lower IDV than newer ones. Your IDV and premium are directly proportional. If you have a high IDV, you likely pay a high premium.

    Engine Capacity

    As we saw earlier, your bike’s engine capacity directly impacts the cost of third-party insurance policies. The smaller the engine, the lower your premium. Conversely, two-wheelers with larger engines will attract a higher premium amount.

    Owner Details

    Your age and riding history will also play a role in deciding your premium amount. Insurers will likely offer a better premium if you’re middle-aged and have a good driving history. If you’re young, under the age of 25 and have met with accidents in the past, you might have to pay a higher premium.

    Add-Ons

    When you purchase a comprehensive policy, you can customise your coverage with add-ons. Every add-on comes at a cost, which gets added to your premium amount. The more add-ons you purchase, the higher your premium. While selecting a bike insurance plan, you must only get those add-ons that add value to your coverage.

    No Claim Bonus (NCB)

    Your insurer offers you a No Claim Bonus (NCB) to reward you for not making any claims in a policy year. Your bonus provides a discount on your premium for the following year. The NCB increases for each subsequent claim-free year. Your NCB can help lower your premium amount.


    Once you understand your needs and calculate your premium, you must buy and renew your policy on time. At the end of every policy term, you can use a bike insurance renewal calculator to see if your premium has changed for the following year. Remember to factor in your NCB while calculating your two-wheeler insurance renewal premium. Find the ideal bike insurance policy for your needs when you visit the Edelweiss General Insurance website.

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