Ah! The joy of bike racks! Yes, they can be a struggle to put on your vehicle but we think it’s a small price to pay to keep the inside of your car dirt-free. So what happens when a bicycle is stolen, or damaged in an accident? Does your bike and bike rack (outside of your car) differ from any other possession inside of your car? Good news, in many cases, bicycles and bike racks may be covered by either car insurance or property insurance, but there are circumstances where coverage varies. Consider these five possible scenarios:
- Your bike is damaged while it is secured to your automobile – In most states, a claim can be filed under the personal property provision of one’s own home insurance or renters insurance policy. If the policy includes a provision for replacement cost value (RCV) coverage, the insurer will pay the replacement cost of the bicycle, less any deductible. However, if the policy provides for actual cash value (ACV) coverage, the insurer will only pay the current depreciated value of the bicycle.
- A different vehicle damages your bike while it is secured to your vehicle – If the liability of the other motorist is clear, then his or her insurer will pay the full ACV of the bicycle. If the motorist is uninsured, that same 100 percent ACV payment will be paid by the insurer of the owner of the vehicle to which the bike is attached. However, this payment occurs only if the owner has uninsured motorist coverage.
- A hit-and-run motorist damages your bike while it is attached to your vehicle – This claim would be paid under the owner’s homeowners or renters policy. Either ACV or RCV would be paid based on the terms of the policy, less the deductible.
- Another person’s bike is damaged while it is secured to your vehicle – In this scenario, the liability portion of the auto insurance will pay the ACV to the owner of the bike.
- A bike attached to your vehicle is stolen – As long as an incident report is filed with the police, one’s renters or homeowners policy will pay the ACV or RCV based on the terms of the policy, less the deductible.
It is important to realize that the typical deductible in a homeowners or renters policy can vary depending on the state, some renter’s deductibles can start from $250+ and homeowner’s can start from $500+. Therefore, in many instances where a claim is made under the provisions of such a policy, a portion of the bike’s value will not be paid by the carrier as the deductible will be your responsibility..
Fortunately, there is another option. A so-called “floater” can be purchased that specifically covers the full cost of repairs, or the full RCV if the bicycle is not repairable. If one has a very valuable bike, perhaps for racing, it can also be insured via its own policy.
Find out if your current policy has bike racks covered by car insurance, bicycle theft and other damages by giving us a call at 1-800-258-5101. With over 5 million vehicles and homes insured, not only can we help you find insurance that covers bicycles, we may be able to save you hundreds of dollars on auto insurance each year… it may be enough financial savings to justify buying a new bike!