Choosing the right IDV (Insured Declared Value) in your bike insurance policy can be the difference between full compensation and unexpected losses. Many riders overlook this simple detail and end up with lower payouts than expected. If you want to safeguard your bike’s true value, understanding IDV in bike insurance is essential.
Let’s explore how you can make the right decisions to maximise your payout.
Understanding the Basics of Bike Insurance
Bike insurance protects you against financial loss from accidents, theft, or third-party liabilities. There are three main types of bike insurance:
1. Third-Party Cover
- Legally mandatory.
- Covers damages to third-party property or injury to another person.
- Does not cover your own bike.
2. Comprehensive Cover
- Covers third-party liabilities and own damage.
- Includes protection against theft, fire, accidents, and natural disasters.
- Recommended if you want full financial security.
3. Standalone Own-Damage Cover
- Only covers damages to your bike.
- Must be paired with a third-party policy separately.
Why it Matters:
A comprehensive plan is usually the better option to maximise your payout. It covers your bike and third-party liabilities, ensuring complete protection.
What is IDV in Bike Insurance and Why Does It Matter?
IDV (Insured Declared Value) is your bike’s estimated market value when you buy or renew your policy. It is the maximum sum insured that your insurer will pay if your bike is stolen or damaged beyond repair.
The IDV in bike insurance is calculated using:
IDV = Manufacturer’s listed price – Depreciation as per the IRDAI schedule
Depreciation Schedule for Two-Wheelers:
| Age of Bike | Depreciation Percentage | Approximate IDV |
| Up to 6 months | 5% | 95% of the price |
| 6 months to 1 year | 15% | 85% of the price |
| 1 to 2 years | 20% | 80% of the price |
| 2 to 3 years | 30% | 70% of the price |
| 3 to 4 years | 40% | 60% of the price |
| 4 to 5 years | 50% | 50% of the price |
| Above 5 years | Agreed between the insurer and the owner | Variable |
Why it Matters:
Your claim payout will be based on the IDV (Insured Declared Value). Setting it too low can result in underpayment during a claim, while setting it too high unnecessarily increases your premium.
How to Choose the Right IDV for Maximum Bike Insurance Payouts?
Selecting the right IDV is crucial. Here’s how you can get it right:
1. Match the Market Value
Check the current resale price of your bike on online platforms.
2. Avoid Under-insuring
A low IDV may save a little on premiums, but can cost much more later.
3. Use Flexibility Wisely
Many insurers allow you to adjust the IDV within a range. Always opt for the highest realistic value.
4. Renew Smartly
Update your IDV each year based on the current value, not just accept the insurer’s default option.
Example:
If your bike’s resale value is ₹75,000, setting your IDV close to ₹75,000–₹78,000 is smart.
Tips to Increase Your Bike Insurance Payout Using IDV
Follow these expert tips to ensure maximum payout without unnecessary costs:
1. Always Renew Before Expiry
Late renewals can reset your No Claim Bonus (NCB) benefits.
2. Update IDV Manually
During renewals, adjust the IDV closer to the actual market value.
3. Consider ‘Return to Invoice’ Cover
This add-on helps recover the original invoice amount for new bikes if stolen or totalled.
4. Compare Quotes
Different insurers may set slightly different IDVs. Always compare.
5. Check the Claim Settlement Record
Opt for insurers with a high claim settlement ratio (above 90%).
Choosing the right bike insurance provider is as important as choosing the right IDV.
Common Mistakes to Avoid When Setting IDV in Bike Insurance
Avoid these pitfalls to get the best out of your policy:
● Choosing the Lowest IDV
Just to reduce the premium, this limits your payout drastically during claims.
● Not checking IDV During Renewals
Insurers sometimes auto-reduce IDV without notifying you.
● Setting Unrealistically High IDV
Over-insuring can lead to disputes at the time of claim evaluation.
Being vigilant at each renewal cycle ensures you keep your cover strong without overpaying.
Expert Tips to Make the Most Out of Your Bike Insurance Policy
Apart from the IDV, these strategies can help you maximise your overall benefits:
1. Zero Depreciation Add-On
Covers the full cost of replaced parts without depreciation deduction.
2. Personal Accident Cover
Offers financial support if you are injured in an accident.
3. Maintain your Bike Properly
A well-maintained bike faces fewer claim rejections.
4. Use Authorised Garages
Cashless repairs save time and effort, and insurers prefer authorised bills.
5. Keep Paperwork Updated
Ensure your Registration Certificate (RC), insurance copy, and receipts are always current.
These practices not only boost your payout chances but also streamline the claim settlement process.
Choosing the right IDV in bike insurance is a simple yet powerful way to protect your financial interests. By staying informed and proactive, you can secure a fair payout if the unexpected happens. Make sure you review your IDV carefully every year and invest in a comprehensive plan that gives you complete peace of mind.
