Easy Riders: Insurance for Motorcycle Owners

Some bikers have a passion for touring the back roads, while others seek the thrills of an off-road race. More than a few riders simply rely on their motorcycles to get where they need to go.

The number of American households who own motorcycles grew 26% between 2003 and 2008. There are more than 10 million motorcycles on the road.¹ In more ways than one, motorcycles have worked their way into the mainstream — and fair weather makes summertime a fun time to ride.

Here’s a look at the trends and safety issues associated with motorcycle riding, and how to help protect yourself both physically and financially when you’re two-wheeling.

A Changing Face

As the number and variety of bikes on the road grew in recent years, the profile of the typical rider became more diverse.

There are still twice as many baby boomers on bikes than Generation Y (age 30 and under) riders, but Gen Y motorcycle ownership increased 62% between 2003 and 2008.²
Women made up 23% of the 25 million Americans who took a ride on a motorcycle in 2008.³
Motorcycle owners are typically more affluent. The median household income of motorcycle owners is more than $59,000, compared with $50,000 for the entire United States.⁴

For Safety’s Sake

If you own a motorcycle, there are some important safety issues to keep in mind.

Opt for anti-lock brakes: Motorcycles have brakes at both the front and rear wheels, so stopping hard can lock the wheels and cause the bike to flip. A recent study conducted by the Insurance Institute for Highway Safety has shown that motorcycles equipped with anti-lock brakes, which are often an optional feature, were involved in 38% fewer fatal crashes than those without anti-lock brakes.⁵
Always wear a helmet: The law in your state may or may not require helmets, but the National Highway Traffic Safety Administration reported that 1,829 lives were saved by helmet use in 2008, and 823 more could have been saved if riders had been wearing them.⁶
Avoid reckless riding: Dangerous behavior by motorcycle operators contributes to the majority of fatal crashes. In 2008, 29% of riders involved in fatal accidents were intoxicated and 35% were speeding.⁷

Insurance Issues

Most states have specific minimum liability coverage requirements similar to those of automobiles, but you may also purchase additional coverage to protect your investment and for specific cases.

Liability insurance pays for injuries and property damage, up to your policy limits, that you may cause to others in the event of an accident. Guest Passenger Liability may not be included, so you might have to purchase it separately. Liability coverage does not cover damage to your own vehicle.

Collision coverage pays for damage to your bike, minus your deductible and up to your policy limits, if you are involved in a wreck with another vehicle or a stationary object, whereas comprehensive insurance adds coverage for damage from events other than collisions, such as a fire or theft. In both cases, standard insurance will cover only the factory parts on your motorcycle. If you have special upgrades or accessories such as a side car, chrome parts, or a custom paint job, you may want to obtain additional coverage for optional equipment.

Insurance premiums are affected by where you live, where you store your bike, the type of motorcycle you own, how much you ride, and your driving record. Sport models that are built for speed often cost more to insure than cruisers. If you ride only during certain months, you may be able to save money with a lay-up policy that suspends all coverage except comprehensive in the off-season. Taking an approved training course may also get you a discount.

Motorcycle insurance used to be somewhat of a specialty product, but growing popularity means that it’s now widely available as a separate policy or as a rider (endorsement) to your auto policy. We can help you design coverage that addresses your personal situation and lifestyle.

1–4) Motorcycle Industry Council, 2009
5–7) Insurance Information Institute, 2010

The information in this article is not intended as tax or legal advice, and it may not be relied on for the purpose of avoiding any federal tax penalties. You are encouraged to seek tax or legal advice from an independent professional advisor. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. This material was written and prepared by Emerald. © 2010 Emerald.