Brand new Bike
IDV, or Insured Declared Value, most individuals are familiar with this particular motor insurance jargon. In essence, the IDV is the highest value, the sum assured supplied by an insurer to a policyholder, or the highest sum that a policyholder may be entitled to as compensation in the event that the insured bike is totally lost or damaged.
IDV is also taken into account to represent the insured vehicle's current market value. In other words, the entire amount you will be entitled to recover as compensation or reimbursement for the irreparable harm done to your insured two-wheeler is the vehicle's insured declared value.
Therefore, while choosing a comprehensive two-wheeler insurance policy, you must choose an adequate IDV to guarantee that you receive the highest possible compensation pay-out in the event of an accident in the future. The IDV you select will now directly affect the premium that must be paid. Therefore, the higher the selected IDV, the higher your premium will be. The premium is typically charged between two and three percent of the insured vehicle's total IDV.
As previously indicated, the IDV calculator for bikes will assist you in understanding the entire premium due for the insurance policy you have selected. But how can you figure out a bike's IDV?
The IDV value of a bike will be determined by factoring in the two-current wheeler's market selling price. The depreciation of the bike's parts is also subtracted from the market price of the bike to determine theIDV. The following formula can be used to determine a bike's IDV:
(Vehicle's quoted market price - depreciation cost) + IDV (Insured Declared Value) (cost of the bike accessories – depreciation value of the parts)
Here, even a bike's additional equipment will be taken into account when determining the IDV. For instance, the cost of any extras you install, such as body covers, tyre inflators, gears, etc., would be reflected in the IDV calculator for bike.
However, if your two-wheeler is devoid of any additional equipment, you can determine the IDV of your bike on your own with the aid of an online IDV calculator. The formula is as follows:
Manufacturer's registered cost of the bike minus depreciation value is the IDV (Insured Declared Value).
How will this operate now? Therefore, if you get a bike insurance policy and the market value of your bike is 5 lakh, your insurer will pay out up to the maximum value you choose as an IDV in the event that your bike sustains total damage or is lost irreparably. It is imperative to be aware that if your bike is stolen or severely damaged during the term of the insurance, you can only make a claim for the IDV.
The following are some advantages of choosing the right IDV for your bike:
Declaring the correct IDV is crucial since it will also decide the highest compensation you can expect in the event that your two-wheeler is damaged or destroyed.
If you declare your IDV wrong, you are essentially stating a lesser or higher value for your motorcycle. Therefore, if you mentioned the incorrect, lower IDV that is insufficient for your bike, you will receive a smaller amount in the event of claims. If you indicated the correct, higher IDV, you will receive a larger amount in the event of claims.
By comparing the bike's market worth to the same and deducting its depreciation, you may roughly calculate your IDV (based on how old it is). You can also use an online IDV calculator for two wheelers like this one if you're unsure how to proceed.
At Digit, we provide you the option to alter your IDV. However, we always advise providing the correct amount because doing so will provide you the correct premium amount and the exact amount you need for claims. Your premium and maximum claim amount will increase in direct proportion to your IDV, and vice versa.
No, doing this isn't a good idea since if there are claims, you'll only get a smaller payout that might not be enough to cover your particular two-wheeler. Keep in mind that your IDV also represents the maximum amount your insurer will pay out in the event of losses and damages. Therefore, the smaller your premium and IDV, the lower your maximum claim amount will be.