Engine capacity and your bike premium: cc bands explained

Introduction

Your bike's engine capacity, measured in cubic centimetres (CC), determines the Third-Party premium band it falls into. IRDAI sets a fixed Third-Party premium for each band, so all insurers charge the same rate for the same CC band.

What can vary between insurers is the Own Damage premium, IDV and optional covers. This guide explains the four CC bands, what stays fixed, what can vary, how CC affects OD premium and IDV, and how electric two-wheelers are classified.

Third-Party insurance covers your liability for injury, death or property damage caused to another person while riding. Under Section 147 of the Motor Vehicles Act, liability for third-party injury or death is unlimited, while property damage is subject to the applicable limit. IRDAI uses CC bands to set the TP premium for this cover based on the bike's engine capacity.

The 4 bands and the bikes that typically fall into each:

Band 1: Up to 75cc

This band covers mopeds and very small-displacement scooters. Most bikes in day-to-day use in India fall above this band, but entry-level mopeds and older models with small engines sit here in this category. This is the lowest Third-Party premium band for two-wheelers.

Band 2: 75cc to 150cc

This is the largest band by volume, the majority of commuter bikes and urban scooters in India fall here. Common bikes in this band include the Honda Activa 110, the Hero Splendor Plus 100, the Bajaj CT100, the TVS Jupiter 110, and the Yamaha Ray-ZR 125. This band includes most of the two-wheelers currently in use in India.

Band 3: 150cc to 350cc

Mid-displacement motorcycles fall here, both performance-oriented commuters and entry-level sports bikes. Common bikes in this band include the Bajaj Pulsar 150, the Yamaha FZ-S 150, the Honda CB300R, and the Royal Enfield Meteor 350. The Third-Party premium steps up meaningfully from Band 2 to Band 3.

Band 4: Above 350cc

Premium motorcycles, large-displacement cruisers, and performance bikes fall here. Common bikes in this band include the Royal Enfield Classic 500, the KTM Duke 390, the Bajaj Dominar 400, and the Triumph Street Twin 900. This is the highest Third-Party premium band for conventional two-wheelers.

The exact Third-Party premium for each band is published annually by IRDAI. Rates are updated periodically and you can check the current IRDAI rate schedule to confirm the premium applicable to your bike's CC band before renewing or purchasing.

The GST at 18% applies to the total premium, including the Third-Party component, after any discounts.

The CC band determines the fixed TP premium. The OD premium, IDV and optional covers are where insurers can differ.

Higher-CC bikes often have higher purchase prices, which can result in a higher IDV. Since the OD premium is calculated based on the IDV, a higher IDV generally means a higher OD premium.

Even within the same CC band, OD premiums can differ because bikes have different IDVs. The OD premium is not a fixed rate like the Third-Party premium. Insurers price it within the applicable IRDAI-regulated bands, which is why two insurers may quote different OD premiums for the same bike.

CC affects the IDV indirectly through the bike's purchase price. Higher-CC bikes generally have higher purchase prices, which can result in higher starting IDVs. For example, a Honda Activa 110 purchased for ₹75,000 has a much lower starting IDV than a Royal Enfield Classic 350 purchased for ₹2.2 lakhs - the same depreciation rates may apply, but the IDV will still differ because the bikes start at different values.

What this means at claim time

• If your bike is stolen or declared a total loss, the applicable IDV determines the maximum claim amount, subject to the policy terms.
• A bike with a higher IDV can have a higher claim amount than a lower-value bike of the same age.
• Choosing an IDV that is too low can reduce the amount you receive in a theft or total loss claim.

The IDV is therefore important when choosing and renewing your bike insurance. At every renewal, check that the IDV reasonably reflects your bike's current value rather than simply accepting the figure from the previous policy.

Optional covers available for bikes at Kiwi Insurance:

The following optional covers are not available for bikes: Key Secure and Tyre Secure.

Zero Depreciation is available on bikes up to a certain age, check your policy document for the eligibility condition applicable to your bike's age and CC band.

The kW-based bands for electric two-wheelers are

The Third-Party premium for each kW band is set by IRDAI in the same way as CC bands, which means it is fixed across all insurers for each classification. The Own Damage premium is calculated on the IDV of the specific electric bike, which varies by make, model, and variant.

One practical difference for electric two-wheelers: the battery pack is typically a significant portion of the bike's value and replacement cost. Check your policy document for how the battery is treated in the IDV calculation and whether battery damage or replacement is covered under Own Damage or requires a separate endorsement.

• Only with Kiwi Insurance, a dedicated Claims Specialist is assigned to you, one personal contact who explains the process and the documents in plain language from start to finish.
• Your Claims Specialist stays reachable through the Kiwi app for the full duration of the claim, whether your claim is for a scratched panel on a commuter scooter or a major incident on a premium motorcycle, the experience is the same.
• You do not repeat your situation to a different agent on every follow-up as the same specialist handles your case from registration to completion.

The Claims Specialist is assigned after you register a claim, not at the point of buying the policy.

For electric two-wheelers, the same principle applies, but the Third-Party premium is based on motor power in kW instead of CC.

Want to know which CC band your bike falls into and what it means for your premium?

Head to Kiwi Insurance to explore your bike insurance options and get a quote for your specific model.