By Russ Hymas and Ken Christensen –
As bicycle accident attorneys, we often discuss the importance of carrying uninsured/underinsured motorist coverage on cyclists’ automobile insurance policies in the event they’re hit and injured by a motorist with minimal limits of coverage, or no auto insurance at all. But incidents involving bicycles are not limited to collisions with cars. Cyclists must also consider the risks of bicycle theft, damage (to their bike or body) from a crash that doesn’t involve a motor vehicle, and liability a cyclist might have for causing damage or injury to another cyclist, pedestrian, or motorist.
Is it in your best interest to purchase a stand-alone bicycle policy to insure against theft, damage, and/or liability? The truth is, “it depends.” That’s not just a lawyerly cliché. The value of such insurance depends on a number of factors that are discussed below.
Bicycle theft is a concern of all cyclists, and for good reason. According to the National Bike Registry, over 1.5 million bikes stolen in the US each year. Many cyclists correctly assume that their homeowner’s or renter’s insurance will provide coverage for the theft of their bicycle. However, few cyclists have actually read their policies and are unaware of exclusions or limitations of coverage for theft.
Cyclists are often surprised to learn that theft may not be covered by their homeowner’s policy if the bike was stolen outside of the home, or that it is not available if the cyclist failed to put a lock on the bike. In addition to these exclusions, there may be other restrictions on the homeowner’s policy that could limit cyclists’ ability to get full value of their bicycle.
For example, some homeowner’s policies consider bicycles as “sporting equipment” with maximum coverage limits of $500 or $1,000. Other policies require the cyclist to purchase a “rider,” or extension of your homeowner’s or renter’s insurance, to obtain full value of the bike. These riders are often required for personal property items of higher value – such as expensive jewelry or a $10,000 bicycle – and each piece of property needs to be itemized and include an appraisal or proof of the value of the property.
Even if your homeowner’s policy provides does provide coverage for the full value of your bicycle, it’s worth considering whether you want to make a claim on your policy. Homeowner’s policy deductibles typically range between $1,000-$1,500. And often times, making a claim on that policy will result in an increase in your premium (or even cancellation of the policy, if you’ve made previous claims). If your bicycle is worth less than $3,000-$4,000, it may not be worth the expense of a high deductible and increased premiums.
Bicycle insurance policies, on the other hand, insure the bicycle for full value in the event of theft – or damages in an attempted theft – wherever the location. Another benefit is that the deductible for such a policy is $100-$500, significantly lower than homeowner’s or renter’s policy deductibles. It’s important to keep in mind, however, that some bicycle policies still require the cyclist to keep the bike locked.
Although crashes are often the result of a careless action of a motorist, all of us know cyclists who have crashed hitting a pothole or debris in the road, or flown over their handlebars on a mountain-biking trail, or been involved in a pile-up at a race. These crashes often result in significant damage to your bicycle, as well as injuries that require medical treatment.
Bicycle insurance policies are great in these instances. They cover any type of crash or accidental damage – whether you get tangled up in a criterium, slide out going around a corner, or even forget that your bike is on the roof rack of your car and crash into the garage. (We won’t tell you which one of us has done that, but suffice it to say we sympathize with those of you that have made this embarrassing mistake.) Most policies also offer medical coverage that can be added on to the policy for injuries you might sustain, though that coverage is generally an additional cost.
The value of bicycle insurance for you to protect against crash damage will depend on the coverages you already have in place. Medical coverage may be unnecessary if you carry good health insurance. We’ve also found that some homeowner’s policies will cover damage to your bike from a crash, but they’re the exception to the rule. If your homeowner’s policy is one of the few that do afford crash damage coverage, the cautions noted above regarding limits on value and the possibility of increased premiums are worth considering.
None of us ever thinks that he/she will be the cause of a wreck that results in damage or injury to another. But an increase in cycling traffic on Utah’s roads and trails has also led to a rise in the number of these incidents. One cyclist recently made the news for serious injuries he caused by colliding with a runner coming down Emigration Canyon at a high rate of speed. Cyclist vs. cyclist collisions are also commonplace. In these situations, cyclists are wise to ensure they have liability insurance so they are not having to pay the damages they’ve caused out of their pocket.
Again, we strongly recommend a careful review of your homeowner’s or renter’s insurance policy. Surprisingly, several of these policies will cover a cyclist’s personal liability. But you’ll want to know whether you are protected, and the instances in which your homeowner’s or renter’s policy would not provide coverage.
Most bicycle insurance companies offer liability insurance as add-on coverage at an additional cost. An online quote we received from one of the major carriers offered $25,000 of liability coverage for an extra $50 per year on the premium. If your homeowner’s policy doesn’t provide coverage, that’s not a significant amount to give you some peace of mind while out on the road or trails.
Other Considerations / Cost:
The concept of bicycle insurance is relatively new, but several companies have jumped onto the scene to compete for cyclists’ business. Some of the notable nationwide carriers are Velosurance, Sundays Insurance, BigRing Insurance, and Markel. [Note that Spoke Insurance has stopped offering coverage.] We mention these companies specifically because they boast an “A” insurance rating, or are backed by such a company (for example, BigRing is backed by Transamerica). Cyclists should consider insurance ratings to make sure the company they select is financially secure enough to issue you a check if you ever have to make a claim.
These companies will note that, in addition to the types of coverage discussed above, their policies also offer: rental reimbursement; coverage for apparel, helmet & bike computer; event fee reimbursement; and bicycle airline shipping coverage. But given the cost of premiums, even the CEO’s of these companies acknowledge that stand-alone bicycle insurance usually doesn’t start to make sense unless the value of your bike is over $3,000.
Most bicycle insurance companies offer online quotes and even provide sample policies on their websites. The cost of bicycle insurance will vary depending on the value of your bike (with upgrades such as wheels and componentry), the deductible amount you desire, and whether you want add-on coverages such as liability or medical coverage. We found bicycle insurance premiums for as little as $150 per year, but it’s easy to spend $400+ per year if you want all the bells and whistles on a policy. Most policies currently seem to fall in the $250-$300 range, with discounts often available for members of USA Cycling, USA Triathlon and other cycling associations.
Ken Christensen and Russ Hymas are avid cyclists and Utah attorneys at UtahBicycleLawyers.com. Their legal practice is devoted to helping cyclists injured in collisions with motor vehicles. They are authors of the Utah Bicycle Accident Handbook and are nationally recognized legal experts on cycling laws and safety.