One problem which seems to be universal and regardless of the price of the premium is insurers trying to avoid theft claims. Take this scenario. One very common insurance policy says: ‘your motorcycle will not be covered for theft claims if it is stolen from within 1000 metres of your home address, otherwise than from your locked garage’. Because I am a lawyer I read this stuff and asked the salesperson: ‘so if my bike gets stolen from the local shop where I have stopped for milk, then I am not covered?’ She had to say (after checking with her supervisor) that the bike would not be covered but of course the insurers would pay. I am not so sure. A verbal reassurance does not trump a written contract.
My policy document also says if my bike is damaged by a member of my family who has pinched my keys, my fully comp policy will not cover me. Fair enough. But what if you give your keys to a mechanic or a cleaner. The bike is damaged in their care. You have no comeback on your fully comp policy.
But the real risk is if your bike is stolen. My insurer says: ‘any accessories you haven’t declared, we aren’t paying for,’ which is of course fair enough. However, the cheap and not very cheerful insurers go one step further: ‘your undeclared accessories made the bike more attractive to a thief so we are not going to pay out’. This happens a lot. Or at least it did until April 2012 when a change occurred in the insurance laws for consumers.
The 2012 law can be summed up thus: ‘if your insurer thinks a fact is important enough to change the policy price, they have to ask you,’ whereas the old law was, ‘you as a consumer have to decide what your insurer needs to know and if they do not ask, you still have to tell, and just to be really safe, they can get to decide if it was important after you put in a claim’.
To my certain knowledge people had theft claims refused for uprated springs in forks. And the Financial Services Ombudsman upheld these refusals. Now, unless you are asked about something, you do not have to say anything about it. If asked and you mislead your policy is still likely to be invalid.
But be careful. If you answer a question in a misleading way, your insurers do not have to pay you but anyone who has a third party claim on your insurance can claim off your insurers who can then come after you and your assets directly.
Finally, once you sell your bike, make sure you cancel your policy because if the new owner is uninsured, your insurer will be picking up the bill for any harm the new owner creates, and if you have a brass farthing, the insurers will come after you for their outlay. That can cost you bankruptcy and your home.
Andrew Dalton
Bike Magazine January 2015
