Insurance Blog

NEW YORK, May 10, 2010 — Thanks to National Bike Month and Bike to Work Week (May 17-21), many cyclists are getting their bicycles out of storage and onto the roads. Whether they ride commuter, hybrid, mountain or racing bikes, cyclists should understand the rules of the road and protect their financial investment with the proper insurance, according to the Insurance Information Institute (I.I.I).

Bicycling has increased in popularity both as a sport and as a means of transportation. Between 1992 and 2006, bicycle sales increased roughly 20 percent in the United States, from 15.3 million to 18.2 million per year, the U.S. Department of Justice noted in its most recent report. According to the National Sporting Goods Association, 44.7 million people rode bikes in 2008, up 11.4 percent from the previous year.

According to the Federal Bureau of Investigation, more than 221,936 bicycles were stolen in 2008, while National Crime Victim Survey data from 2007 puts the number of incidents of bicycle and bicycle parts theft closer to 1.2 million.

Bicycles are stolen most often in densely populated areas such as cities and suburbs, but university and college towns are another hot spot; in fact bicycle thefts represent over half of property crimes on campuses.

“Bicycles can cost anywhere from several hundred dollars for a garden variety bike to custom-made options that can cost thousands of dollars,” said Jeanne Salvatore, senior vice president and consumer spokesperson for the I.I.I. “To protect your bike, always make sure it is locked up and that you have adequate insurance coverage.”

If you are purchasing a new bike, keep the receipt and call your insurance agent or company representative immediately. Depending on the cost of the bike, you may want to list it on your policy or purchase an endorsement. Your insurance agent or company representative can review your coverage options with you.

Bicycles are covered under the personal property section of standard homeowners and renters insurance policies. This coverage will reimburse you, minus your deductible, if your bike is stolen or damaged in a fire, hurricane or other disaster listed in your policy.

There are two types of coverage for personal property:

• Actual Cash Value -- Actual cash value reimburses you for what the bicycle is actually worth given its age. A 10-year-old bicycle, for example, would be valued at the cost of a comparable bicycle minus 10 years depreciation.
• Replacement Cost Coverage -- Replacement cost coverage reimburses you for what it would cost to replace your 10-year-old bicycle with one of like kind and quality at current cost. Replacement cost coverage costs about 10 percent more than actual cash value, but it is a good investment.

Homeowners and renters insurance policies also provide liability protection for harm you may cause to someone else or their property. If you injure someone in a bicycle accident and he or she decides to sue, you will be covered up to the limits of your policy. Your homeowners or renters insurance also include no-fault medical coverage in the event you injure someone. This coverage usually ranges from $1,000 to $5,000. If you own an expensive bicycle, you may want to consider getting an endorsement

To make filing a claim easier, the I.I.I. suggests the following:

• Save all your receipts -- When you buy your bicycle you may purchase expensive equipment to go with it. Be sure to save your receipts. The cost of a helmet, patch kits, pumps, extra inner tubes and other essentials, not to mention that fancy new bike jersey, can add up quickly. If your bike and related items are stolen or destroyed, having receipts can help speed the claims process.
• Add your bicycle and related items to your home inventory -- Everyone should have an up-to-date home inventory of all their personal possessions. An inventory can help you purchase the correct amount of insurance and make the claims filing process easier if there is a loss. To help you create your inventory, the I.I.I. provides free, online software at KnowYourStuff.org. As well as listing all your possessions (and their serial numbers), the software allows you to add digital photographs, save scanned receipts And generate customized reports, which you can use when filing your claim.

Of course the best protection of all is to keep your bike safe; to help avoid theft, follow these simple rules:

• Always lock up your bike, even if it is in your garage, an apartment stairwell, or a college dormitory.
• Lock your bicycle to a fixed, immovable object like a parking meter or permanent bike rack. Be careful not to lock it to items that can be easily cut, broken or removed, and that the bike cannot be lifted over the top of the object to which it is locked.
• Lock up your bicycle in a visible, well-lit area.
• Consider using a U-lock and position the bike frame and wheels so that they take up as much of the open space within the U-portion of the lock as possible. The tighter the lock-up, the harder it is for a thief to use tools to attack the lock. Always position a U-lock so that the keyway is facing down towards the ground. Do not position the lock close to the ground as this makes it easier for a thief to break it.
• Don’t lock up your bicycle in the same location all the time. A thief may notice the pattern and target you.
• Consider registering your bike with the National Bike Registry.

The National Highway Safety Administration suggests that cyclists follow these seven rules:

1. Protect Your Head -- Never ride a bike without a properly fitted helmet.
2. Assure Bicycle Readiness -- Ride a bike that fits you and check all parts of the bicycle to make sure they are secure and working well.
3. Learn and Follow the Rules of the Road -- Bicycles are considered vehicles on the road; therefore riders must follow the same traffic laws as drivers of motor vehicles.
4. Act Like a Driver of a Vehicle -- Always ride with the flow of traffic, on the right side of the road, and as far to the right of the road as is practicable and safe.
5. Be Visible -- Always assume you are not seen by others and take responsibility for making yourself visible to motorists, pedestrians and other cyclists.
6. “Drive with Care” -- When you ride, consider yourself the driver of a vehicle and always keep safety in mind. Ride in the bike lane, if available. Take extra care when riding on a roadway. Courtesy and predictability are key to safe cycling.
7. Stay Focused. Stay Alert -- Never wear headphones as they hinder your ability to hear traffic. Be aware of your surroundings and ride defensively.
   
   To learn more about bicycle safety, visit the National Highway Traffic Safety Administration
   
   For a related Web video, go to Bicycle Insurance Quiz.
   
   For a related Video News Release, go to Bicycle Safety. Reporters who would like a DVC Pro or Beta hard copy of the b-roll footage, please contact: Susan Stolov at 202-230-7040 or Susan Stolov@WashingtonIndependentProductions.com.
   
   For additional information on bike month activities, contact the League of American Bicyclists.
   
   The Insurance Information Institute is a nonprofit, communications organization supported by the insurance industry.