State law requires you to have Motorcycle liability insurance, and if you still owe money on your cycle, your lender requires that you also carry collision and comprehensive coverage. Motorcycle insurance pays for damages, injuries, and other losses specifically covered by your policy. Read your policy carefully to know exactly what it covers. Pay special attention to the exclusions section, which lists the things your policy doesn’t cover. The front page of your policy is called the declarations page. It contains useful information such as the exact name of your insurance company, your policy number, and the amount of each of your coverages and deductibles.

Requirement Proof of Financial Responsibility

If you drive, you must show that you can pay for accidents you cause. Most drivers do this by buying Motorcycle liability insurance. State law requires a minimum coverage. However, basic coverage might not be enough if you are held liable for an accident. You should consider buying more than the basic limits. When you buy an Motorcycle policy, your insurance company will send you a proof-of-insurance card. You will have to show proof of insurance when you:

  • are asked for it by a law enforcement officer
  • have an accident
  • register your cycle or renew its registration
  • obtain or renew your driver’s license
  • get your cycle inspected.

State law provides severe penalties for violating the state’s financial responsibility laws.

Motorcycle Insurance Coverages

State law requires you to have basic liability coverage. The other coverages are optional, but if you still owe money on your cycle, your lender will require you to have collision and comprehensive coverage. The following describes the eight types of coverage available.

1. Liability Coverage

Pays: Other people’s expenses for accidents caused by drivers covered under your policy, up to your policy’s dollar limits. These may include the other person’s

    • medical and funeral costs, lost wages, and compensation for pain and suffering
    • cycle repair or replacement costs
    • Motorcycle rental while their cycle is being repaired
    • punitive damages awarded by a court.

Covers: You, your family members, and other people driving your cycle with your permission, even if they don’t have their own liability insurance and are not named on your policy. You and your family members also are covered when driving someone else’s Motorcycle - including a rental cycle - but not a cycle that you don’t own but have regular access to, such as a company cycle.

Who qualifies as a family member?

Your Motorcycle policy covers your spouse, blood relatives, in-laws, adopted children, wards, and foster children living in your home, even if not named on the policy. Family members attending school away from home and a spouse living elsewhere during a marital separation also are covered.

2. Medical Payments Coverage

Pays: Medical and funeral bills arising from accidents, including those in which the victim was a pedestrian or a bicyclist. Covers: You, your family members, and passengers in your cycle, regardless of who caused the accident.

3.Personal Injury Protection (PIP) Coverage

Pays: Same as medical payments coverage, plus a percentage of lost income and the cost of hiring a caregiver for an injured person. Covers: You, your family members, and passengers in your cycle, regardless of who caused the accident.

4. Uninsured/Underinsured Motorist (UM/UIM) Coverage

Pays: Your expenses from an accident caused by an uninsured motorist or if the other driver did not have enough insurance to cover your bills, up to your policy’s dollar limits. Also pays for accidents caused by a hit-and-run driver if you reported the accident promptly to the police.

    • Bodily injury UM/UIM pays without deductibles for medical bills, lost wages, pain and suffering, disfigurement, and permanent or partial disability.
    • Property damage UM/UIM pays for Motorcycle repairs, a rental cycle, and damage to items carried in your cycle.

Covers: You, your family members, passengers in your cycle, and others driving your cycle with your permission. Insurers must offer UM/UIM coverage, but you can reject it in writing.

5. Collision (Damage to Your cycle) Coverage

Pays: The cost of repairing or replacing your cycle after an accident, regardless of who was driving or who was at fault. Payment is limited to your car’s actual cash value, minus your deductible. Actual cash value is the market value of a cycle like yours before it was damaged.

6. Comprehensive (Physical Damage Other than Collision) Coverage

Pays: The cost of replacing or repairing your cycle if it is stolen or damaged by fire, vandalism, hail, or another cause other than collision. Comprehensive coverage also pays for a rental cycle or other temporary transportation if your cycle is stolen. Your policy won’t pay for an Motorcycle theft unless you report it to the police. Payment is limited to your car’s actual cash value, minus your deductible.

7. Towing and Labor Coverage

Pays: Towing charges when your cycle can’t be driven. Also pays labor charges, such as changing a tire, at the place where your cycle broke down.

8. Rental Reimbursement Coverage

Pays: A set daily amount for a rental cycle if your cycle is stolen or is being repaired because of damage covered by your policy.

Coverage When Driving in Other States, Canada, and Mexico

Your policy automatically meets the financial responsibility requirements of other U.S. states and Canada. Mexico, however, does not recognize U.S. Motorcycle liability policies. Mexico does not require drivers to have Motorcycle liability insurance. However, drivers can be held criminally and financially responsible for any Motorcycle accidents they cause. If you’re in an accident that results in an injury, police in Mexico may detain you until they determine who is at fault. You will have to show that you either have insurance recognized by the Mexican government or the financial ability to pay any judgment against you. You can buy Mexican liability insurance from agents who specialize in it. Some U.S. companies provide a free endorsement extending your policy’s coverage to infrequent trips of up to 10 days and as far as 25 miles into Mexico. You can buy coverage for longer stays, but it is valid only within 25 miles of the border. Telephone books in border towns list insurance agents that specialize in cycle insurance for travel in Mexico. Your agent also might be able to help you find coverage with a Mexican company. You also may be able to buy a limited Mexico "tourist" endorsement that extends your liability coverage to pay expenses exceeding those covered by a Mexican liability policy. This endorsement covers trips of any distance and any length of time. Ask your agent which endorsements your insurance company offers.

Shopping for Motorcycle Insurance

Rates vary widely among companies, so it pays to shop around. Following are some useful tips to help you find the best deal for your money:

  • Decide before shopping what coverages you need.
  • Consider choosing a higher deductible. Your deductible is the amount you must pay yourself before the insurance company will pay. Higher deductibles will lower your premium, but remember that you’ll have to pay more out of your own pocket if you have a claim.
  • Because rates vary, ask several companies and agents for price quotes. Make sure the quotes you get are for the same coverages.
  • When getting a price quote or applying for insurance, answer questions truthfully. Wrong information could cause you to get an incorrect price quote or could lead to a denial or cancellation of coverage.

Consider factors other than price - including a company’s financial rating and its complaint index. Financial ratings indicate a company’s financial strength and stability, while its complaint index indicates a company’s customer service record. Buy only from licensed companies and agents.

  • Ask your agent whether you qualify for any discounts the company may offer.
Factors that Affect Your Premium

Companies may use a number of criteria to establish your individual premium. These include:

  • Your age and, for younger drivers, your marital status. Male drivers under 25 and unmarried women under 21 have the highest rates. Drivers over 50 may get discounts.
  • Your driving record and claims history. A good driving record can save you money. If you have accidents or tickets on your driving record, you’ll likely be placed in a nonstandard company, which charges higher rates. In addition, companies can add penalties - called surcharges - to your premium for major driving offenses and accidents resulting in property damage of $1,000 or more. Surcharges are mandatory for rate-regulated companies and stay on your premium for three years.
  • The county where you keep your cycle. Because urban counties have more accidents and Motorcycle thefts, their rates tend to be higher than those of rural areas.
  • The type of cycle you drive. Collision and comprehensive rates are highest for luxury, high-performance, and sports cars. Rates may also be higher for cars that damage easily or cost more to repair than others.
  • How you use your cycle. Rates are higher for cars driven to and from work or used for business.
  • Your credit score. Companies may consider your credit score when deciding whether to sell you a policy and what to charge you. However, a company cannot refuse to sell you a policy or cancel or nonrenew your policy solely on the basis of your credit.
  • Whether you drove uninsured. Companies can charge more if you drove uninsured for more than 30 days in the 12 months before you applied for insurance. However, a company cannot otherwise charge you a higher rate for liability coverage because of your prior lack of coverage.

Companies must file their underwriting guidelines and update them each time they make a change.

Discounts and Surcharges

Discounts can help you save money on your premium. Following is a list of some of the discounts commonly available:

  • defensive driving and driver education courses for young drivers
  • airbags and other passive restraints
  • two or more cars on a policy
  • your age and annual mileage driven
  • policy renewal with a good claims and driving record
  • anti-lock brakes
  • a parent or family whose young driver is away at school without a cycle
  • cars with automatic daytime running lights
  • students with good grades.

If you have a poor driving record, you can expect to pay more for your insurance. Companies may add surcharges to your premium for the following:

  • accidents (the more accidents, the higher the surcharge)
  • moving violations (speeding, etc.)
  • involuntary manslaughter
  • driving under the influence
  • criminally negligent driving
  • driving without a license or with a suspended license.
Your Rights Against Unfair Discrimination

An insurance company cannot deny, refuse to renew, limit, or charge more for coverage because of your race, color, religion, or national origin. A company also cannot deny, refuse to renew, limit, or charge more for coverage because of your age, gender, marital status, geographic location, disability, or partial disability unless the refusal, limitation, or higher rate is "based on sound underwriting or actuarial principles." This means the company would have to show valid evidence that you present a greater risk for a loss than others it is willing to insure. Also, a company cannot nonrenew your policy because someone in your family has reached driving age. In addition, a company cannot unfairly discriminate between individuals of the same rate or risk class in its rates, policy terms, benefits, or in any other manner unless the refusal, limitation, or higher rate is "based on sound actuarial principles." You may sue insurance companies for unfair discrimination, including denial of insurance. However, if the court finds the suit groundless, in bad faith, or brought for the purpose of harassment, you may be ordered to pay the insurance company’s legal expenses.

Insurance Options for High-Risk Drivers
  • Several major insurer groups write coverage for high-risk drivers through one of their member companies.
  • Keep shopping! Each company has its own underwriting guidelines for deciding whether to insure people.
After the Accident... What Now?
  • Move your cycle, if possible, to avoid blocking traffic and to protect it from further loss or damage.
  • Call the police if somebody is injured or killed, if a vehicle can’t be moved, or if the accident involved a hit-and-run driver. Your uninsured motorist coverage pays for a hit-and-run accident only if you report the accident to the police.
  • Get the other driver’s name, address, telephone number, license plate number, driver’s license number, and insurance information. Give the other driver the same information about you.
  • Record the insurance company name and the policy number exactly as shown on the other driver’s proof-of-insurance card. Similar company names can cause confusion, so make sure you write down the correct company name.
  • Get the names, addresses, and telephone numbers of any witnesses to the accident.
  • Notify your insurance company as soon as possible. Your company probably has a 1-800 number to report claims. If not, call your agent. Some agents have authority to settle small claims. The agent or company will advise you about seeing an adjuster and getting repair estimates. Also, give your agent or company the names and addresses of any witnesses and injured persons.
  • If you reported your claim by phone, be sure to follow up in writing as soon as possible to protect your rights under the States’ prompt payment of claims laws.
  • Send the company copies of the accident report and any legal papers you receive about the accident.
  • Cooperate with the company’s investigation. You might have to submit a proof-of-loss form and undergo a medical examination.

If the other driver refuses to tell you his or her insurance company, get a copy of the police accident report. The accident report will list the other driver’s name and insurance company. If the police did not investigate the accident, you can report the driver’s refusal to the police.

Accidents Caused by Other Drivers

If you were in an accident caused by another driver, the other driver’s insurance company should pay the following costs, up to the policy’s limits:

  • repair or replacement of your cycle
  • cycle rental while your Motorcycle is being repaired
  • your medical and hospital bills
  • wages lost because of an injury
  • compensation for pain and suffering if anyone is hurt.

If the other driver’s insurance won’t cover all your medical bills, you should file a claim for the difference against your Personal Injury Protection (PIP) coverage, if you have it. For amounts over that, you can claim against your uninsured/underinsured motorists (UM/UIM) coverage or your health insurance policy. If the other driver’s policy won’t cover all of your Motorcycle repairs, file a claim against your collision or UM/UIM coverage for the difference (minus your deductible) between the damage to your cycle and what the other driver’s policy will pay. The other driver’s insurance company may ask you to sign a release to settle your claim and forgo future claims related to the accident. Don’t sign a release until you are satisfied with your total settlement. Get a letter from your doctor estimating the cost and length of your future medical treatment. You might want to consult an attorney before accepting a settlement. Under State law, you have two years after an accident to either settle your claim or file a lawsuit. State law prohibits insurance companies from delaying payment on a claim as a means to pressure you to sign a release. If you believe an insurance company is delaying payment to you so that you will sign a release, you should file a formal complaint. If the other driver denies fault, his or her insurance company may refuse to pay the claim. Independent witnesses could make a difference in getting the company to pay. It’s important to get names, addresses, and telephone numbers of any witnesses to the accident. Make sure the insurance company knows about the witnesses. If the company continues to refuse to pay the claim, you can file a claim against your own insurance or you may have to go to court to resolve the issue. Before filing a claim against your own company, it’s a good idea to talk to your agent or your company’s underwriting department about how a claim might affect your rates on renewal. A company can raise your premium because of at-fault accidents. Also, a company cannot refuse to renew your policy solely because you had one accident that was not your fault in a 12-month period. However, if the accident affected your driving record, your company may consider that in determining your rates, whether you made a claim on the accident or not.

Filing a Claim

Once you have filed a claim, State law sets these deadlines for the insurance company to act:

  • The company must respond within 15 days after receiving your claim in writing. It probably will ask you to document your loss.
  • After you submit any requested documentation, the company has 15 business days to accept or reject your claim.
  • Once the company agrees to pay your claim, it must send your check or draft within five business days.

A company that cannot meet these deadlines must send you a notice explaining why.

Motorcycle Insurance for Young Drivers

Young drivers must comply with the state’s financial responsibility laws, just as older drivers do. Most young drivers, however, have the option of satisfying their legal requirements by being added to their parents´ Motorcycle policy. Adding a young driver to a parents´ policy can be expensive, but it’s cheaper than taking out a separate Motorcycle policy. A parents´ policy covers children living at home or away at school, even when not named on the policy. Even though children are automatically covered on their parents´ policy, it’s important that they be listed on the policy as soon as they reach driving age. Insurance companies are required to charge the correct rate, based on the classifications of the drivers in your family. If you don’t have all of the drivers in your family listed on your policy and the company learns about them later - because of an accident claim, for instance - the company will bill you for the extra premium you should have paid. If you have children attending school away from home, tell your insurance company. Because rates are based on where a cycle is usually located, the insurance company may need to adjust your premium. If the school is in another state, it’s a good idea to check on the financial responsibility laws in that state to make sure you have the appropriate coverages. When you add your children to your policy, they may be rated on the most expensive Motorcycle in your household. The rules for this are complex and address a variety of situations, however. Generally, if a teen-ager is the "principal driver" of a particular Motorcycle, his or her rate will be based on that cycle. If not, the teen-age driver is assigned to the cycle (usually the most expensive) that produces the highest rate.

Saving Money on Insurance for Young Drivers

Unfortunately, insuring young drivers is usually expensive. Some young drivers may qualify for discounts, however. If you are under 18, you must complete a driver training course approved by the state to obtain a driver’s license. Many insurance companies give a driver training credit for teen-agers who complete driver education. Parent-taught drivers are eligible for the discount if the parent used a state-approved course. Some companies offer discounts to young drivers who make good grades in school or who belong to certain youth groups. Ask your agent about any discounts for young drivers.