We caught up with insurance broker and avid cyclist RICCARDO STERMIN to find out what is important when you insure your prized possession. IMAGE: OAKPICS
This is a hotly debated topic discussed at length when matters go pear shaped following a claim. As with any short-term insurance product familiarising oneself with the policy terms and conditions (the dreaded fine print) is key. There is no perfect insurance policy. It has not been created and should such a product ever be developed it will be unaffordable. As it is, insuring one’s prized bicycles on an all risks bases are costly. Should a bicycle be insured on this basis the cover will be worldwide but it is crucial to make certain that the Insurer grants cover for losses taking place while the bicycle is in use and more importantly when participating in timed racing events. Certain nonspecialist bicycle insurers exclude losses arising from accidents taking place during a race that being a timed event and not a coffee shop ride with mates that develops into a testosterone struggle. With the cover on an all risks bases the policy should cater for any losses such as hijacking and damages following an accident including impact while being transported in/ on a vehicle. All policies will exclude wear and tear. In terms of Public Liability extension, the policy will also cater for damage to third party property that a cyclist might be liable for when the cause of an accident. This will more often than not involve damage to another vehicle. In addition to covering the bicycle wearing apparel, general cycling gear and electronic training devices can also be insured against the exact same perils as the bicycle. These items will have to be listed separately with a listed value usually based on new replacement cost. The same applies to the bicycle. Should one have bought a used bicycle it can be insured at the new replacement price regardless of condition. All modern-day policies base the cover on replacement value conditions with no wear and tear percentage deducted. In fact, some specialist pedal cycle insurers insist that the sum insured of bicycles be calculated on the new value to avoid an under-insurance issue. This is not the case with general non specialist bicycle insurers where goods are covered under an All Risks Section which does not have an Average Clause. Specialist bicycle insurers, unlike conventional insurance companies, will have more restrictions in place, they are after all carrying a high-risk item on a free-standing bases without low risk supporting business. The downside of placing the bicycle cover under one’s home policy is that in the event of a large loss the claim value can impact negatively on the general loss ratio of the entire policy. Should one have a spate of bicycle claims the insurer is going to increase the overall policy premium. It is therefore more beneficial to place the bicycle cover with a specialist insurer should one be faced with a situation of increased premiums due to poor loss ratio. Another relevant point is that when upgrading components such as group set or wheels it is important to note that the insurers are made aware of the changes and that the insured value is altered accordingly. This is more so important should an itemised list of components have been supplied at the time of arranging the cover. Insurers will make use of this inventory at the time of claiming. People who have a set of training and racing wheels need to be extra careful in this instance. Rather cover the race wheels as a separate item. From past experience it is best to place the cover with a company specialising in bicycle insurance such as Cyclesure or Miway. Having said this Cyclesure are the leaders in this field and have stood the test of time watching competitors come and go over the years. As for general non-specialist bicycle insurers there is Santam, Bryte, Mutual and Federal, Hollard, MUA, Vantage and Echelon to name a few.