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The importance of bike insurance and where you park

Is it worth cutting corners and skipping bike insurance altogether and how can you find value for money cover?

Why do you need bike insurance?

In June 2009, the Department of Transport published its annual figures on road casualties in Great Britain. It found that the number of people killed in road accidents stood at 2,538 in 2008.

Among them were 493 motorcycle user fatalities in accidents reported to the police during the year. The number of people killed or seriously injured in motorbike accidents stood at 6,049 over the year with all motorcycle user casualties combined standing at 21,500.

Clearly no matter how skilful the rider, there is always a risk that an accident could occur – and this is where bike insurance can prove so useful. The aim of bike insurance (depending on the level of cover you take out) is to cover the costs of riding related damage and injuries – without it you may be left to cover expenses on your own. Bike insurance can also protect you against risks such as bike theft and accidental damage. Broadly, there are three levels of cover available:

  • Third party only: Covers liability for injuries to others and damage to their property.
  • Third party, fire and theft: Third party only cover, plus protection for your own vehicle in the event of a theft, theft-related damage or fire damage
  • Comprehensive cover: Incorporates all of the cover in third party, fire and theft insurance plus it will typically allow you to make a claim for any damage suffered to your own motorbike in the event of an accident (subject to policy exclusions).

Depending on the policy you take out, there may be a number of additional features offered as standard or as optional extras (available for an additional premium). These may include: cover for riding other motorbikes in the event of an emergency with the owner’s permission; legal protection; breakdown cover; and travelling in Europe.

How much does bike insurance cost?

Bike insurance premiums are determined by how the insurer evaluates your ‘risk level’ – i.e. the likelihood of you making a claim. The higher the perceived risk of a claim being made, the higher bike insurance premiums will be.

Criteria for determining this risk varies between insurers but typically a provider will consider:

  • Your claims history: How recently have you made a claim on your bike insurance?
  • Driving record: Do you have any riding related convictions? What about named riders on your policy – how recently have they made claims for accidents or received a riding related conviction?
  • Mileage: The more time you spend on the road, the more likely it is that you will be involved in an accident, so agreeing to a mileage cap could reduce premiums.
  • Personal circumstances: Insurers assess an array of personal criteria when evaluating premiums including whether or not you are married; your occupation; and how long you have held your licence for.
  • Your bike: The bike you ride will greatly influence your premiums – for example, if you ride a performance bike then you may face higher insurance costs because of an increased risk that you will be involved in a high impact crash. As a rule of thumb, older bikes with smaller engines qualify for cheaper premiums.
  • Your address: Insurers take into account where you live by examining accident rates in the area, crime rates and so on.

As insurers assess these criteria in different ways, premiums can vary widely between providers – emphasising the importance of shopping around with a comparison website to ensure you’re receiving value for money.

For example, we ran quotes with a leading comparsion webiste for a 27-year-old male rider from Merseyside who owns a 2005 Honda VFR 800 A, who rides up to 5,000 miles a year, has five years’ no-claims, and agreed to a £250 voluntary excess. His cheapest quote was £123.28 a year from the 23 insurers willing to quote. However, the highest premium from the listed insurers was £659 for the same driver – a difference of more than £500 - clearly emphasising the importance of comparing quotes.

How does parking influence bike insurance premiums?

Where you park can also play a significant role in the quotes you receive. For example, the rider above parks his motorbike in a locked garage overnight. By parking in a non-secure car park or on the road at home overnight, the cheapest quote available rises by more than £35 a year to £159.76.

So not only will parking securely reduce the risk of bike theft, it will also limit your bike insurance premiums. Consult your insurer too about security devices you could install – both electronic and mechanical – that could also earn significant reductions on annual premiums.