Calculation of IDV
The IDV is always calculated on the manufacturer’s listed selling price of a particular brand and model of the two wheeler. It is the amount proposed for insurance at the commencement or renewal of the insurance and is adjusted for market depreciation as per the schedule listed below:
| Vehicle’s Lifetime |
Percentage Of Depreciation |
| Less than six months |
5% |
| Exceeding six months but less than a year |
15% |
| Exceeding one year but less than two years |
20% |
| Exceeding two years but less than three years |
30% |
| Exceeding three years but less than four years |
40% |
| Exceeding four years but less than five years |
50% |
If your two wheeler is 5 years old or beyond, you would still get the IDV amount depending on the condition of your two wheeler’s body parts and its serviceability. Even if your two wheeler is an obsolete model, you will still be able to get its IDV value through a mutual agreement with your insurance company.
Understanding IDV Better
Always remember that the compensation is provided only in case of total loss, accidental damage or theft of your two wheeler and within the motor insurance policy period. Another interesting fact is that IDV is always calculated on the current selling price of the vehicle and not the one at the time of purchase.
For instance, a bike costs ₹ 80,000 in 2015 and the same model costs ₹ 90,000 in 2016, then your IDV will be calculated on ₹ 90,000.
Often, buyers compromise IDV at the time of purchase. A lower IDV at the time of purchase will reduce the cost of premium but will result in a much higher loss while making a claim. It is therefore advisable to not skimp on your premium and declare the correct IDV of your two wheeler.
What Happens If I Sell My Two Wheeler
If you sell your two wheeler to another person then your insurance also gets transferred to that person and the IDV will continue as previous. However, the same insurance cannot be transferred to a different two wheeler and a fresh insurance needs to be purchased in such case.