The Motor Vehicles Act, 1988 makes it mandatory for all bike owners to insure their bikes and renew their bike insurance before due date to ensure continued insurance coverage and protection at all times.. Non-compliance of this rule can lead to imposition of fine and enforcement of other legal provisions as mentioned in the motor vehicles act by respective government transport agencies. The insurance policy should at-least cover third party liability by default, which implies damages to third party person and property caused by the insured bike.
There are times when the insured policyholder is mulling over cancelling the cover during the policy period due to multiple reasons. The reason can vary from discontent with the high value of premium paid to limited terms and coverage. With increased competition in the vehicle insurance market, the customer is often lured with schemes and offers, tempting him to switch over to a different insurer.
Is the Bike Insurance Cancellable?
The answer to this is YES. The policy can be cancelled not only after expiration of the policy term but also during the policy period. Not many are aware that the cover can be dissolved during the policy period. The general assumption is the policy has to run through the entire period of one year. However, cancelling the bike insurance policy comes with certain terms and conditions. They are as follows.
- The cover can only be annulled if there are no claims made on the insured vehicle during the entire duration of bike insurance policy being active. The policy holder should have made arrangements for alternate coverage, at least for third party liability and should produce documentary evidence to support the insurance cover.
- In thecase of ownership transfer, existing policy cannot be cancelled unless theprovision of documentary evidence of analternative arrangement is made to support the insurance cover.
The bottom line is, you will not be able to cancel the insurance policy if you do not have an alternative insurance cover. The aim of the motor vehicle act rule is that the vehicle should always be covered against third party liabilities resulting from an accident
Process to Cancel Bike Insurance Policy
The insured owner is required to provide a notice of 7 days to the insurer in writing, of their intention to cancel the policy.
- Contact the existing bike insurance policy insurance company, preferably by phone and express your intention to cancel the policy.
- Follow the procedure provided by the representative of your existing bike insurance policy insurer and ensure that you notify them officially in writing, at least 7 days in advance.
- Ensure availability of documentary evidence like the new bike insurance policy document if you bought an insurance policy for your two wheeler with a different insurer.
- Mail, email or fax it to the number or address provided. You may also be asked to drop the paperwork at the nearest branch by your existing bike insurance company ,the insurer would verify the documents submitted by you and based on the cancellation terms and condition the further steps will be taken.
- A minimum premium of Rs.100* will be retained by the insurance company and the balance will be refunded based on pro rata basis as per the cancellation terms and conditions of the insurance company.
* Rs.25 in case of two wheelers designed/or modified for vehicles owned by blind/handicapped/mentally challenged owners.
Tip: If you’re contemplating on switching over to another insurer for your two wheeler for a lower premium, compare the benefits and features before making a decision to ensure that no compromise is made on the financial safety and third party liability protection aspects