Motorcycle Insurance 101

What You Should Know Before Insuring Your Motorcycle

Motorcycle Insurance 101
May 25, 2015

As a motorcycle rider, you enjoy the feeling of freedom as you head out on the highway. Just don’t forget that the freedom comes with responsibility – such as the need for motorcycle insurance.

Aside from a generally lower premium, there is very little difference between motorcycle insurance and auto insurance – but they are distinct and different policies. Unless you have specifically added your motorcycle onto your insurance policy, your motorcycle is not covered under your auto insurance policy – and in most states, it is illegal to drive a motorcycle without insurance. (In the remaining states, it is just a bad idea.)

Penalties vary by state, but why risk it at all? Check your insurance options before you purchase a motorcycle; you may be required to show proof of insurance before you can complete the sale.

You may be able to get a combined policy, or receive a discount from holding your motorcycle insurance with the same company as your auto insurance.

The available policies are similar to auto insurance policies, as you might expect.

  • Liability – You are generally required to carry liability insurance at a minimum. Your liability coverage includes property damage that you cause to others, and bodily injury coverage for any harm to another person or persons in any accident that you cause.

    Because you are likely to do less damage to property and less harm to people when on a motorcycle compared to driving a car, liability premiums are generally less for motorcycles (approximately 60-70% of an auto insurance premium).

  • Uninsured/Underinsured Coverage – This covers you if you are hit by an uninsured or underinsured driver. Motorcycle riders should generally have as much of this coverage as they can afford, because auto drivers are usually at fault in auto-motorcycle accidents, and there are a significant number of uninsured auto drivers.

  • Collision and Comprehensive (C&C) – As with automobiles, the collision component covers damage to your vehicle from an accident, and comprehensive coverage handles non-accident related damage such as theft or fire.

Your premiums will be determined in similar ways to your auto policy, based on the risk you represent and the replacement value of your motorcycle. Factors include the value and type of bike that you own, how you store it, how often you drive it, where you drive it, and under what conditions.

One difference in motorcycle insurance is a “lay-up” policy, which suspends coverage for certain months during which riding your motorcycle is impractical, for example if you live in winter climates. You can save money by eliminating winter premiums – but you are also obligated to stay off the road. You are not covered if you do take your motorcycle out during the lay-up period.

If you do have a lay-up policy, you want to keep the C&C component to deal with any damage or theft of your motorcycle while it is in storage.

You can save even more by taking pre-emptive steps such as taking a motorcycle safety course and keeping your driving record in good standing (auto as well as motorcycle). Check for any discounts for which you may qualify.

Another way to save on insurance is to purchase a standard motorcycle, not a high-risk, high-performance model… but only you can determine whether the pleasure of a high-powered bike is worth paying extra in premiums.

Take the time to insure yourself and your motorcycle properly, and you can enjoy a season of carefree motorcycle rides. If your rides are not carefree, at least a lack of insurance coverage will not be the reason.

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