How To Choose Between A Multi-Year And Single-Year Bike Insurance Policy?

Just booked your new bike? Do not forget to buy a robust insurance policy to protect it from the start. Or, you could be looking for options for your bike insurance renewal. Either way, choosing between long term bike insurance or multi-year insurance and a single-year policy remains a dilemma for most bike users. 

Bike insurance is necessary to protect your bike and finances from unforeseen circumstances. In India, two-wheeler owners must have a third-party two-wheeler insurance policy. Not having one can result in hefty fines and/or imprisonment. 

However, purchasing a bike insurance policy is not as simple as it may sound. There are many factors that you must consider to ensure your policy offers adequate coverage in the time of your need. Besides, your policy should be worth the amount you spend as the premium cost. One such critical factor when you buy bike insurance or renew a policy is choosing between a single-year or multi-year policy.

Today, we will discuss long term bike insurance and single-year insurance in detail.

What Is A Multi-Year Policy?

Until recently, the two-wheeler insurance policies were renewed annually to ensure continued coverage. However, now you can choose a multi-year policy for your bike. It means you can get three to five years of continuous coverage. Such a policy is also known as long term bike insurance and it eliminates the hassle of renewing your policy every year.

The Insurance Regulatory and Development Authority of India (IRDAI) has made it compulsory for all new two-wheelers in India to have a five-year insurance cover. This was done because, despite strict regulations, many two-wheeler owners avoided renewing their annual policies leaving pedestrians and others using public roads vulnerable to losses due to their bikes. By making long term bike insurance compulsory, the IRDAI ensures the safety of others on the road.

Bike owners with a single-year policy can upgrade to a multi-year insurance policy at the time of bike insurance renew.

Features Of Multi-Year Insurance

Multi-year policies come with several features and benefits. Some of them are: 

Convenience: Multi-year policies are convenient as you do not have to renew them every year. Also, you do not have to worry about the policy lapsing because you forgot the renewal date. Once you purchase the policy, you are sorted for at least three to five years.

Lock-in pricing: The premium for a long-term bike insurance policy is fixed at the beginning of the policy. The premium remains the same for the entire policy term, which makes it a cost-effective option for bike owners. If you have a single-year policy instead, the premium is subject to change every year based on inflation, tax rates, and other factors. 

No Claim Bonus: In a multi-year policy, you instantly receive the benefit of a No Claim Bonus for the entire policy term. This reduces the policy cost significantly, making it highly cost-effective.

Add-ons: With a multi-year policy, you can get add-ons at discounted rates. Since the add-ons once added will be applicable for the entire policy year, the insurer may offer you discounts. However, you should be careful while choosing the add-ons since you cannot change them during the policy period.

Also Read: How To Buy A New Bike – A Complete Guide for Beginners

What Is A Single-Year Policy?

Unlike long term bike insurance, a single-year policy is valid only for a year. You have to renew it every year to ensure continued protection and benefits. This is the traditional policy that most two-wheeler owners purchase. It allows you the option to change your insurer and add-ons during renewal, if necessary. 

However, this type of policy is also more expensive than a multi-year policy as the premium changes every year. And, the bike insurance renewal process can be a hassle. 

Features Of A Single-Year Policy

You must be quite meticulous and disciplined to own and maintain a single-year policy. Some features of a single-year policy include:

Low upfront cost: Since you purchase the policy for a year, the upfront costs are low in a single-year policy. You only have to pay the premium for a year. This puts a lesser financial burden on you.

IDV regulation: Single-year policy allows you to regulate your IDV. You can set it at every renewal and ensure you receive the maximum benefits. This is not possible with long-term bike insurance.

Flexibility: Single year policy allows you the freedom to change your insurer every year. You can also change/add/remove any add-ons you want from your policy during renewal.

Quick Differences Between Multi-Year Vs. Single-Year Bike Insurance Policy

Let us discuss the primary differences between multi-year and single-year bike insurance policies:

BasisMulti-year insuranceSingle-year insurance
Renewal Policy renewal every three to five years, depending on your policy. The policy has to be renewed every year to get continued protection.
Pricing The premium amount is fixed (remains the same) until the policy expires. The premium amount can change every year depending on different factors. 
Ease The multi-year policy offers more ease as you can purchase it for three to five years. You don’t have to go through the hassle of renewing it every year.The single-year policy has to be renewed every year, which can be a hassle. It is also possible to forget to renew it which may land you in legal trouble.
No Claim BonusA higher No Claim Bonus is given in a multi-year policy.The No Claim Bonus discount is lesser compared to a multi-year policy.
Own-damage discountInsurance providers give discounts on own damage.There is no discount on own damage in this policy.
Changing insurerYou have to stay with the same insurer until your policy expires. You can change your insurer every year if you are not happy with their services. 
Add-ons You can select add-ons only while purchasing the policy. You can add or remove add-ons every year during policy renewals.
Flexibility A multi-year policy is less flexible than a single-year policy. More flexible as you can avail of different discounts/offers every year.

Multi-Year Vs. Single-Year Bike Insurance Policy: Which One Is Better?

You may be wondering which policy is more beneficial for you. If you have purchased a new bike, then as per the IRDAI, you must purchase a multi-year insurance policy. However, if you are renewing your policy, you may choose one of the two.

A multi-year policy is undoubtedly more cost-effective, hassle-free, and beneficial for bike owners. However, it also has its cons as it is less flexible and bounds you to an insurer for a long time. You can overcome these issues by doing thorough research and choosing a reputed and trustworthy insurance provider.

Single-year policy, on the other hand, is more expensive, but also more flexible. You can change your insurer and add-ons annually. 


Based on your needs, if you want a hassle-free, cost-effective, and long term bike insurance policy, choose a multi-year bike insurance policy. But, if you prefer freedom and flexibility and are okay with paying more premiums, then go for a single-year insurance policy. 

Now that you know the advantages and disadvantages of both multi-year and single-year bike insurance renewal your policy based on your needs and budget. 

Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales.

Also Check This: How To Claim Car Insurance? A Step By Step Guide

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