How Will Modifying Your Bike Impact Its Insurance Premium?

Are you thinking about modifying your bike to give it a different shine in the spotlight? Have you informed your insurance company? If not, you will be going to pay for it?

Here’s why — every person has their reason for bike modification. However, it’s been observed that many owners give the go-ahead without knowing the impact of changes on their two-wheeler insurance plan.

So, lets deep dive into the essential things to keep in mind before deciding on any modifications to your prized possession.

Type of modifications and premium

If you have a basic third-party insurance policy for your bike, bike modifications will not impact your monthly premiums because third-party insurance does not cover the own damage.

However, if you have comprehensive bike insurance, its insurance premium is affected by any modifications because it covers your own damage plan.

• Security based modifications

Security-based modifications can help you to save money on your two-wheeler insurance. Such type of modifications are designed to diffuse the chances of theft. Suppose you have installed an anti-theft device like alarms, locks etc., you will fall under the low-risk category.

Most insurance companies provide discounts for installing the anti-theft device, as they see it as a solid preventive measure against theft.

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So, It’s a win-win situation for the insurance company and the policyholder, as no bike theft means no theft claim! Make sure you install only those devices which are certified by the ARAI (Automotive Research Association of India) to avail a discount on bike insurance premiums.

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• Aesthetic modifications

These modifications are meant to enhance the look of your bike. Changing colour, adding fibre parts, and showcasing graphics come under aesthetic modifications. It tends to increase the bike value at some points and increase the chances of theft. Additional bike accessories suggest that more parts can be damaged in case of accidents. All these factors directly impact the insurance premium, and the insurance company asks for higher rates.

• Performance-based modifications

Performance-based modifications are those which increase the bike’s output. It could be a fuel-efficient system or speed-changing mechanism. As we all know, higher speed comes with a higher risk of an accident. So that the insurer might see these types of modifications under the frequent claim category, the insurance company might charge a higher premium to cover the bike that has been modified to increase its performance.

• Modifications for disabled

If a bike is modified for the disabled person to make it comfortable and convenient for them. In that case, the insurance company will not charge any extra premium for these modifications.

This modification offers additional discounts to encourage disabled people to move freely and fearlessly. To avail of the discount offered by the insurer, you need to keep all the details of the necessary modifications done to the two-wheeler and notify the insurer when purchasing or renewing the insurance policy.

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Inform the insurer

Usually, insurance companies do not inspect the bike before insuring it unless there has been a considerable gap between the expiry and policy renewal. The insurance premium is charged according to the bike’s model, variant, and other factors.

Modifications can change the bike’s overall appearance, and it affects the overall insured declared value of the bike.

That is why the insurer needs to know about all the modifications and the risks. Because once the risks are known, the insurance company can charge an appropriate premium to insure your bike. But if you do not inform your insurer about the modifications and raise the claim, they might reject the claim as they were unaware of the changes made to the insured vehicle.

Premium friendly modifications

Some modifications do not create an adverse impact on your bike insurance premium. For example, modifications like crash bars, upgraded brake system, increasing engine capacity up to 5% etc., will not increase the premium. While suspension, tank pads, and wheel modifications are even accepted and lead to a minimum increase in premium.

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Essential things to keep in mind

• In case of an accident claim, If the insurer notices any modification that is not informed, It can directly affect the claim. They might reject your claim. So, be careful!
• If you are planning a major modification to your bike, do not hesitate to ask different insurance companies if they charge an additional premium. Some insurance providers may or may not charge anything for modifications. So, just make it clear from your side.
• Keep in mind that even a minor modification to your bike will amplify your comprehensive bike insurance. So, if you do not inform your insurer about the changes, your claim may be denied, or the insurance company may cancel your policy.
• The most important aspect of bike modification is following the local law. You should ensure that you have the necessary permission to make the changes to your bike, and the bike is legal on the road after the modifications.

Remember all these factors influencing your bike insurance policy. But if you want to modify your dream bike, dare to ignore its impact on insurance premiums.

Don’t forget to inform your insurer about the modification you want to your bike before implementation so that they can assess the risk factors and suggest the insurance premium according to that.

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Image Source: Vinh Dao, free on Canva Pro

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