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Bicycle insurance: Protecting your pedals

No matter whether you take your recreational bicycle for a leisurely spin around the neighborhood or you ride an expensive bike geared for hard-core competition, your two-wheeler is a target for thieves. Or your bike could just as easily be damaged or destroyed.

Whether your pedal-related peril involves theft or damage, your homeowner's or renter's insurer probably will pay to repair or replace your bicycle. However, you may be spinning your wheels by filing a claim.

“Because they’re part of your personal property, bicycles are eligible for the same coverage as your television or clothing," says Bob Dean, founder of Dean & Draper Insurance, an independent insurance agency in Houston.

bicycle insurance

So if your bike is stolen, is destroyed in a fire, is picked up by a tornado or is run over in your driveway, you're able to file a claim with your home insurance company. But you'll have to pay the deductible that's attached to your policy. Furthermore, Dean says, your insurance company will cover the actual cash value -- not the higher replacement value -- to repair or replace your bike.

“You can purchase home insurance policies that include replacement value, which would include coverage for a bicycle, but those policies tend to be much pricier and the rates can run as much as 25 percent higher than cash-value policies,” Dean says.

Depending on the bicycle’s age, it might not even be worth filing a claim, Dean says. He points out that the value of a 5-year-old bike would be figured by taking the cost of a new bike and subtracting five years' worth of depreciation.

“Unless the bicycle cost thousands of dollars, that claim might not be worth filing because of the resulting potential increase in your renewal rates over the next few years -- just because you filed the one bike claim," Dean says.

For some cyclists, filing a claim is worth it, though.

Two weeks after Joseph Cavalieri’s bike was stolen from the basement of his Manhattan co-op, he received a check to cover part of the loss. “Luckily, my homeowner's insurance policy through Travelers covered the claim after I submitted the police report,” he says. “The whole process was really hassle-free.”

The accidental encounter

Having your bike stolen or destroyed is one thing. But what if you collide with a car or pedestrian while riding your bike?

Franklin Rooks Jr., an insurance attorney in Philadelphia, says that if the car or pedestrian is at fault, the other party's insurance is responsible for damage to your bike as well as any injuries. “In most states, if the accident involves a car, their auto insurance would cover the claim. If a pedestrian hits you, the personal liability portion of their renter's or homeowner's insurance policy will cover the claim for your injuries as well as the loss of your bicycle,” he says.

In the event the motorist or pedestrian is at fault and doesn’t have insurance, Rooks says you may end up needing to file a claim with your home insurance company.

If you’re the cause of the accident, Dean says, your damage as well as the other party's damages and injuries could be covered by the personal liability portion of your homeowner's or renter's insurance’s personal liability. Meanwhile, your health insurance would pick up the tab for any injuries you suffered while riding the bike.

Depending on your state’s laws, your auto insurance coverage might extend to a bicycle accident claim, Rooks says.

bike insurance

What if you don’t have homeowner's, renter's or auto insurance? Beware. “If you’re uninsured, you could be sued for damages,” Rooks says.

The business biker

As for someone who's riding a bike for work -- a messenger or a sandwich deliverer, for example -- the insurance implications can be a little tricky.

Dean says that bike messengers and others who use their bikes for business usually are independent contractors – not employees – but still may be covered under the company's business liability policy and worker's compensation policy.

“If the business is operating without insurance, the cyclist may be personally liable in the event they are at fault in an accident,” Rook says.

Thinking of starting a bike messenger service or pedicab business? Not all traditional carriers provide coverage.

“State Farm doesn’t offer coverage if you use your bicycle for work. So a bike messenger would likely need to pursue carriers who provide business policies for general liability coverage for himself and any employees who get in an accident, cause damage or cause injury to themselves or someone else,” says Jeff McCollum, a State Farm spokesman.

A bike messenger who pedals more than 100 feet from the messenger business also needs something called "inland marine" coverage for items he's transporting, such as paperwork and packages. "This is similar coverage to what a delivery truck owner would have, whether they are delivering furniture or groceries,” McCollum says.

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