What Is the Difference Between Short-Term and Long-Term Two-Wheeler Insurance Plans?

For the effective safety of your favourite bike, you need the right insurance policy. Insurance companies in India have introduced different types of two-wheeler insurance plans with diverse benefits. Your aim is to secure maximum affordable protection and look for additional optional covers that can enhance your

coverage. Did you know that two wheeler insurance is of two types: short-term and long-term insurance? Some important differences between the two will help you choose the right policy according to your needs.

Major Differences Between Short-term and Long-term Bike Insurance

The two types of insurance are different under the following parameters:

  1. Periodicity of policy renewal: In short-term policies, you have to renew the plan every year, while long-term policies can provide bike insurance coverage between three to five years depending on the terms and conditions of the insurer.
  2. Modifications to policy conditions: As short-term policies are renewed every year, you can modify the insurance plans based on changing needs. You can make use of the offers and discounts announced every year for your benefits. Therefore, short-term insurance policies are more flexible in comparison to long-term plans.
  3. Bike insurance cost: Long-term plans do not account for a yearly increase of premiums that are fixed by the Insurance Regulatory and Development Authority. Insurers offer many discounts for long-term policyholders, especially those associated with Own Damage. On the other hand, if you opt for short-term plans, you will have to pay based on the premium amount declared for the year.
  4. Add-on rider options: Insurance companies also provide additional covers to enhance coverage, such as zero depreciation, no claim bonus, return to invoice etc. In a short-term policy, you can include the add-ons as per your preference and requirement every year.
  5. No Claim Bonus: NCB acts as an incentive for not lodging a claim under the policy in a given year. It is offered to the policyholders in the form of discounts in the premium payment at renewal for the next year. In long-term bike insurance, this may not be possible as the policyholder could lodge a claim over the years and lose out against short-term bike insurance.

We have seen the basic differences between the two types of bike insurance. Let us now discuss the pros and cons of them to help you choose the best option.

Short-term bike insurance


  • The premium amount is comparatively lesser as it is paid for one year.
  • You can get the no claim bonus and the associated discounts every year.
  • Higher flexibility towards modifying the features of your bike insurance plan.


  • You need to remember the renewal dates and take necessary action for renewal on time every year.
  • The premium amount will be subject to changes announced by the IRDA and can increase in the course of one year. It also means there may not be extra protection for the increase in premium amount for the same plan.

Long-term bike insurance


  • Renewals are not made every year. This saves time and effort.
  • Premium amount is consistent throughout the policy term and is not subject to an increase every year if announced. Hence, it is a cost-effective solution.
  • Attractive discounts are available on the premium amount.
  • The no-claim bonus will be a huge amount if there is no claim made throughout the long tenure of the policy.
  • Enhanced and long-term protection is available at a comparatively lower cost.


  • It is not suitable for older vehicles.
  • No claim bonus is applicable only when there is no claim throughout the long-term policy tenure.
  • As the policy is for the longer term, you might need to pay the premium amount upfront.

How to Choose the Right Bike Insurance Plan?

Every type of product has its advantages and disadvantages. TATA AIG 2 wheeler insurance has varied features that you can modify as per your requirements. It is your responsibility to understand them and make the best choice to suit your needs. Compare the bike insurance policies and choose one based on the insurer’s reliability. Some of the factors that you should keep in mind while purchasing a policy are:

  • The area where you stay in terms of safe parking space and protection from theft, riots


  • Your riding requirements, that is, how much for work, pleasure, and other reasons; how often do you ride; and the areas and terrain that you ride in
  • Riding style as in beginner or experienced, and cautious or adventurous
  • Mindset on the maintenance of your bike, whether you want regular upkeep of the bike parts or on breakdown repairs only


Insurance for a bike is a legal and financial necessity. Insurers in India have varied insurance products to accommodate the needs of every type of bike owner. Short-term insurance and long-term insurance are the two basic types of two-wheeler insurance plans. If you are looking for a cost-effective and hassle-free solution, then long-term bike insurance is ideal. However, if you need specific protection and flexibility in your insurance plan, short-term bike insurance cover is certainly the best. Analyze your situation, riding style and your financial capacity before making the appropriate decision.


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