We have a sign out front of our office where we put up little messages. For the longest time the sign read “NEED HELP WITH MEDICARE CALL US”
We had so many people call and stop in that my dad, our Healthcare guru, finally told us to change the damn thing! Healthcare can definitely be a challenge to work with in today’s world.
So when the weather got warm in the Spring we changed it to, “WE INSURE BIKES AND BOATS TOO! STOP IN FOR A QUOTE.” We got crickets. No one called. No one stopped in. No one cared.
Until just the other day. A man saw the sign few months back. He is considering buying a bike that will cost $8,100! That’s Eight Thousand One Hundred Dollars. He said he got a quote to insure the bicycle from his Homeowners agent at Erie Insurance Group for around $600 for the year. Seems like a lot. In fact most if not all of our Motorcycle policies are less!
I did some research and found that most Homeowners policies would cover the bike without any extra premium. I even reached out to our Travelers Insurance Underwriter and discussed it with him. Here’s what I found out.
Under a Travelers Insurance Homeowners policy, the bike would be covered up to the full replacement cost. There is NO limit! In the event of a claim, the Insured would need to pay their deductible. Also, the claim handler would take depreciation off of the total amount of the initial claim check. That depreciation would be returned but only after the bike is replaced.
The bike could also be covered under it’s own Personal Articles Floater (PAF, sometimes called an Inland Marine Policy). Here are some benefits of a PAF;
- There is a low and often times a zero dollar deductible.
- A claim on a PAF will not affect the Homeowners Policy whatsoever.
- A PAF is an agreed value policy. The bike would not be subject to depreciation.
The cost of a PAF for a bike is $9.35 per $100 through Travelers. So for a bike valued at $8,100 the cost of the PAF would be $757.35. This is not cheap but you need to consider a few things.
- A claim filed through your Homeowners policy could result in a loss of your “Loss Free Discount”. This discount could be as high as $300-$400 and you would lose it for at least 3 years.
- You would have to pay your deductible. Any new Homeowners policy written with Travelers has a minimum deductible of $1,000.
- A claim on your Homeowners Policy will make it difficult to find a lower rate if you start shopping your insurance.
It’s a risk you take, pay the high premium for the PAF and possibly not have a claim or just chance it and go through your Homeowners policy if you do. In 9 years of being in the industry I have never seen a claim for a bicycle. But I have also never seen an $8,100 bike!
In this case I advised my new biker friend to contact his agent at Erie and discuss the coverage available through his Homeowners Policy.
What would you do?
My name is Keith Laskey. My goal is to educate the everyday consumer and to help them make intelligent decisions with their insurance policies. Please contact me at my office, 610-948-4830 or Email Me for any insurance related questions or concerns. You can also visit the Ron Black Agency website or like us on Facebook! Thank you for stopping by, have a great day!