# KNOW YOUR TWO WHEELER IDV

One of the concepts that many people are not clear about is the IDV in bike insurance. In two-wheeler insurance, IDV refers to the Insured Declared Value of your vehicle. It represents the total worth of your two-wheeler and the amount you will get back from the insurer if your vehicle is destroyed beyond repair or is stolen. The concept has a lot of importance in insurance and the aim of the post is to help you know all about your two-wheeler’s IDV.

# IDV in Two-wheeler Insurance

IDV represents the market value of your bike after applying depreciation. For example, imagine that you have just bought a brand new two-wheeler for Rs. 100,000 (excluding the costs related to registration, insurance, road tax, and accessories). Your two-wheeler’s IDV at the time of buying is Rs. 100,000. As your two-wheeler becomes older, its value depreciates. This means that the market value of your bike reduces as it gets older. Suppose, the value of your bike depreciates to Rs. 70,000 after two years, the IDV of your vehicle will also be the same.

Now, one important aspect you have to keep in mind is that IDV is applicable only if you buy a comprehensive insurance policy for your bike. Another important aspect is that the IDV is worked out based on the percentage of depreciation as specified by the manufacturer of your vehicle. This does not mean that you can sell the vehicle only at the IDV. If a buyer is prepared to pay more for your bike, you can sell it at the offered price. The table below gives you an idea of the depreciation rates applied by insurers for arriving at the two-wheeler IDV value.

 Age of the Bike Depreciation % Up to 6 months 5.0 6 months to 1 year 15.0 1 to 2 years 20.0 2 to 3 years 30.0 3 to 4 years 40.0 4 to 5 years 50.0 More than 5 years mutually agreed upon by the policyholder and insurance provider

## IDV Calculator for 2-wheeler

The calculation of the IDV of a two-wheeler is very simple. The IDV of a bike is calculated by deducting the depreciation cost from the bike’s ex-showroom price or the current market value. The IDV does not include the registration cost, insurance cost, or the applicable road tax. If you buy any accessories for your bike and get them fitted later, the IDV of such accessories will be worked out separately.

### The factors that are considered for calculating the IDV are:

• Make and model of your two-wheeler
• City in which your bike is registered
• Type of fuel to be used in your bike
• Type of insurance you have purchased for your bike

Most insurance companies provide a two-wheeler IDV calculator on their website.  The bike insurance calculator gives you an idea of the premium payable and the IDV of your vehicle. It is important to ensure that the IDV for your two-wheeler is right. Some insurance companies offer low premium products. This results in the lowering of your vehicle’s IDV. This is not right because in the event of total loss or theft, you will be eligible for getting much less value for your bike when you file a claim.

In conclusion, the IDV determines your bike’s right value as it considers various factors such as its make, model, age, and the cubic capacity of the engine, among others. As insurance companies provide coverage for your vehicle based on the IDV, it is very important that you always state the correct amount.

FAQs

### Q1: What happens if the IDV declared by me is incorrect?

A1: If the IDV declared by you is incorrect, you are insuring your vehicle for a lower or higher value. If you give a lower IDV, the premium you pay and the compensation you receive during claims will be less. In case the IDV stated is higher, the premium you pay and reimbursement you receive during claims will be higher. It is always best to give the right IDV.

### Q2: Why should I declare the right IDV for a two-wheeler?

A2: It is very important to declare the right IDV for your two-wheeler. This is because the premiums you pay towards your bike’s insurance policy and the settlement you receive during claims due to damages or loss will also be right.

### Q3: Does the IDV of my two-wheeler decrease?

A3: Yes, it does. Your bike's IDV decreases with time because of wear and tear.

### Q4: How do I calculate my bike’s IDV?

A4: You just have to use the two-wheeler IDV calculator on our website. Enter the registration number of your two-wheeler to know the IDV of your vehicle.