Decoding IDV In Bike Insurance For Your Old Bike

Introduction

Vikrant is very fond of his motorcycle. While renewing his policy, he observes that the Insured Declared Value (IDV) is playing a role in his bike insurance premium. Lower IDV translates to lower premiums and vice versa. Vikrant does not want to pay higher premiums but is careful about making any mistake by compromising on the coverage. 

So, how to choose the right IDV? Let’s delve into the importance of IDV in bike insurance, ensuring your rides remain protected and your trusted companion’s legacy stays secure.

What is IDV ?

IDV (Insured Declared Value) is the maximum amount your insurance company will pay if your vehicle gets stolen or is completely damaged and declared a total loss. In simpler terms, IDV in bike insurance is like a safety net for your vehicle, ensuring you get a fair amount in case something unfortunate happens. The formula for IDV is straightforward: just take the listed price and subtract the depreciation value.

The depreciation value is calculated based on the age of the vehicle, as shown in the table below:

How to decide the Right IDV ?

It’s crucial to figure out the right IDV to ensure your bike insurance is covered enough. Getting it wrong can mean overpaying for your insurance or shortchanging when you need it the most.

Let’s break down the steps to calculate IDV for bikes:

• Check your bike’s value: To determine the value of your motorcycle, you can use online platforms that consider factors such as the make, model, and age of your bike. These platforms provide valuation services to help you estimate the current market value of your two-wheeler.
• Factor in depreciation: Refer to the depreciation table we discussed earlier to calculate the decrease in your bike’s value over time as your bike ages.
• Subtract depreciation: Subtract that depreciation value from your bike’s current market value. You’re left with your IDV – the magic number for your insurance.

Remember, your IDV shouldn’t be too high (unless you enjoy paying more premiums) or too low (unless you’re into getting less than your bike’s worth if things go south). Get this right, and your bike insurance will have your back when it matters most.

Factors to Consider

When figuring out your vehicle’s IDV, think about these key things:

• Age matters: Older vehicles get a lower IDV. The older it is, the less value it holds.
• Check the condition: If your vehicle is in great shape, that can boost the IDV. Keep it well-maintained for a higher value.
• Market value counts: The IDV hinges on what your vehicle is worth in today’s market. So, calculate it based on its current market value.

Key Takeaways

Getting the right Insured Declared Value (IDV) in your old bike insurance is a big deal. Don’t forget to factor in depreciation; it’s like a time tax for your bike. Striking the sweet spot with your IDV is crucial; too high means more premiums, and too low means risking less coverage when you need it. So, keep it balanced.

Consider platforms like PhonePe for a seamless and hassle-free insurance purchase experience.