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A Buyer’s Guide to Motorcycle Insurance

With an increasing number of cars on the road, driving any distance can often take time, especially in built-up areas. So when you learn that traveling on a motorbike can, on average, shorten a trip by 33 minutes every hour in towns and cities, it is little wonder that there are over 10 million motorcycles registered in the U.S. and an estimated 25 million riders.1

However, motorcycles have a far greater number of risk variables than cars, and arranging appropriate coverage can take longer. As well as engine size, there are many different types of motorcycle and not all insurers will offer coverage for every type. Examples of models which some insurers opt to exclude are high performance, street sports, motocross and classic bikes.

Motocross is a slightly different breed of motorcycle—some people refer to them (disparagingly or otherwise) as dirt bikes. These motorcycles are not street legal and are designed to traverse rough terrain. They have a robust suspension with a raised ground clearance as well as bigger tires. Despite not being designed for use on the roads, it is nevertheless necessary to carry insurance as having an accident or collision could still result in a significant liability situation. It is important to obtain the right kind of coverage because standard policies will usually exclude accidents resulting from off-road activities, racing or stunts.

Just as with auto insurance, there are many different types of potential coverage for a motorcycle policy, but there are two which the law requires every motorcycle rider to have. Bodily injury liability insurance provides coverage if you are the party at fault in an accident and another person is injured or killed. Among other things, this type of insurance pays out up to the policy limit for medical expenses and loss of income for the other party, as well as funeral costs in the event of a fatality.

Property damage liability is the second kind of compulsory insurance. Similar to bodily injury liability, this coverage pays out if you are at fault for an accident and meets the cost of either repairing or replacing not only the other party’s vehicle, but also any property damage.

However, while there is no legal requirement to take out insurance other than bodily injury and property liability, most riders opt to take out additional coverage to ensure they are more comprehensively insured in the event of an accident.

Many motorcyclists opt to include both underinsured and uninsured motorist coverage in their policy. This type of insurance pays out for all damages and liabilities that an at-fault driver or rider would have been responsible for if they had been adequately covered, including the cost of medical expenses and loss of income, as well as property damage.

Unfortunately, if the worst happens, injuries sustained in a motorcycle accident are often far worse than those for car crashes. Medical payments coverage can be added to an insurance policy which ensures that the costs of all medical treatment, both immediately after the accident and on an ongoing basis are paid for, regardless of the party at fault. Some policies stipulate that other forms of medical insurance must first be used and may place a cap of around three years after which it ceases to pay out for treatment. It is also known as Personal Injury Protection in some states.

Many riders are passionate about their bikes but would be unable to afford to replace or repair them if they were damaged in an accident. Collision coverage ensures that any damage to the bike is paid for if it collides with another object, stationary or mobile. Being hit by another vehicle while your motorcycle is parked up is also covered by this type of insurance. However, if the motorcycle is damaged as a result of something other than a collision, in ordered to ensure the costs are covered, comprehensive insurance is also required. This provides coverage for damage or loss as a result of other causes such as fire, vandalism or theft.

While comprehensive insurance means that all the major costs such as liability for other party’s personal and property damages (as well as your own) are insured, it is possible to extend the policy to incorporate additional elements.

Many bikers like to customize their motorcycles for comfort and personal taste. To ensure that all equipment is adequately covered, it is possible to purchase custom parts and equipment insurance, which insures extras such as seats, fairings and crash bars. For those who don’t wish to be deprived of the use of a motorcycle, rental reimbursement coverage exists to pay for the costs of leasing a bike while yours is being repaired following an accident.

Motorcyclists concerned about the costs of their coverage can reduce them in several ways. Undertaking an advanced rider course is a good way to qualify for a significant discount, as well as equipping the bike with features such as a tracking device. Riding safely and avoiding claims obviously helps to keep premiums low, but also paying on time and in full rather than in installments can work out cheaper in the long run. Increasing the deductible on the policy can also have a significant effect on costs, but if you cannot afford the deductible in the event of a claim it is a false economy. Opting to cover both a car and a motorcycle on the same policy can help to drive costs down, as well as increasing coverage if you request stacking. This means adding the coverage for both together in the event of a claim.

Insurance terms vary significantly between providers and it is important to check the policy carefully before proceeding. It is also worth talking to the insurer to see whether they offer any other cost-cutting initiatives.

  1. Motorcycle Industry Council, 2008 Motorcycle Industry Council Owner Survey, May 2009.