How important is it to insure my bicycle? Can my car insurance cover me while I’m riding my bicycle as well? If not, what kind of insurance will cover my bicycle?

There are a lot of questions when it comes to getting a bicycle insured. For avid cyclists these questions take on even greater importance. According to Bicycling.com the newest high-end bicycles typically cost somewhere between $5,000 and $10,000 but some bikes like the new EMX-7 by bike manufacturer Eddy Merckx can have retail prices over $20,000.

Insuring a bicycle may seem unnecessary to anybody that has never purchased a bicycle that costs more than some cars but to those that have it is both necessary and problematic. It is necessary because no one is more vulnerable on the road than a cyclist having to navigate streets filled with vehicles that weigh 100 times more than a bike. Even a minor accident can wreck bicycle’s frame, which is easily the most expensive part. Unfortunately auto-insurance does not typically cover damages caused while riding and so additional forms of insurance are often required.

Insuring a bicycle is also problematic because most major insurance companies don’t include any bike specific accident coverage in their standard insurance plans. It is possible however to find some kind of plan offered by an insurance company that covers a bicycle in a few situations. Allstate car insurance, for example, does not specifically cover bicycles but with their Personal Property Protection as a part of their Homeowner’s insurance a policyholder will be covered against theft and some cases of accident damage.

Another way to insure a bicycle is through umbrella policies that many insurance companies offer. These policies come into effect after the coverage from a person’s other insurance plans are exhausted. This can be a sure way to guarantee coverage because most companies, like State Farm, offer umbrella coverage on personal items for up to as much as $1 million worth of damages.

Both of these options are imperfect, however, because they either do not offer coverage in every situation or they can only be added in the form of expensive, all-encompassing premium insurance policies. An ideal form of bicycle coverage would be a policy that treats a bicycle like it does any other type of vehicle. Then the bike could be added to an existing car insurance policy for a minimal increase in the insurance premium while still guaranteeing full and fair compensation when a high-end bicycle needs to be replaced or repaired.

This is easier said than done unfortunately because, according to Doug Foulks, a Nationwide product manager, most insurance companies are reluctant to invest fully into bicycle insurance because “it’s not the most profitable. People tend to crash.”

Despite the risks many companies are making some attempts to cater to the high-end bicycle owner. Perhaps the best example of this is Clipp Inc. Clipp is a bicycle company that noticed the need for more specific bicycle insurance coverage. The standard insurance plan costs $99 per year which guarantees $1,000 of accident medical coverage per occurrence, $1,000 of property damage per occurrence (after a $500 deductible), $1,000 of theft coverage and $25,000 of accidental death coverage. If more coverage is desired then it can be increased by $1,000 for every additional $15 the customer adds onto the yearly fee.

Clipp’s insurance plan is far from perfect. The $500 deductible for its property damage coverage is too high and Clipp is only available in Texas, Oregon, California, Washington and Virginia. Still Clipp seems to be a good model of how bicycle insurance could be offered by other companies.

The amount of coverage you want will depend on a lot of factors, including the value of your bike, the amount of time you spend riding it and the cost of insurance. The best place to start, when deciding whether to increase your insurance coverage or not, is probably your local insurance agent who will be able to explain whether or not your current policy covers what you need it to.

Image courtesy of Steven Leith