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When the temperatures start to dip, most motorcycle enthusiasts retire their bikes to the garage for the winter. But does that mean you should temporarily cancel your motorcycle insurance?
While it might save you a few premium dollars, dropping your insurance coverage while your motorcycle’s in winter storage may not be a wise choice. Here’s why:
Think about it. There’s always that one dry sunny day that comes along that has you going for that winter ride. So if you cancel your insurance and your area of the country is hit with unseasonably warm winter weather, you’ll have to fight the impulse to take your bike out for a ride. Unfortunately, that quick trip around the block means you’re hitting the road without the insurance to protect you in the event of an accident or other unexpected event.
You also need to remember that your bike still faces risks when it's supposedly "safe and sound" in storage. Theft, fire, vandalism, and storm damage are all possible risks. If you were to cancel your insurance and something were to happen to your bike, you could be left to pay the damages or the repair costs out of your own pocket.
You may not actually realize any cost savings by cancelling your policy over the winter months. While insurance companies will vary, many take into account the typical riding season in your state when they price a policy (spreading it over a 12-month period). That means you may not be entitled to a refund if you cancel your coverage early. Check with your insurance agent to determine if seasonal coverage options are available.
So, while there are some good reasons to hang on to your policy over the winter months, is there anything you can do to realize some savings? Depending on your insurance company, the answer is yes. And while your driving record, the number of miles you ride, and where you actually store your bike are all factors that can impact your premium, you do have some options available to you.
Ask your agent about “lay-up” coverage. According to the Insurance Information Institute (III), a lay-up policy temporarily suspends all but the comprehensive coverage on your motorcycle insurance. Comprehensive coverage protects you against an event that's not related to a collision, such as theft, vandalism, or other similar incident that might occur while the bike is in storage. Even if you don’t have a lay-up option, you might be able to make a similar, temporary reduction of coverages on your own policy, so check with your agent. (Just be sure to reinstate all your coverages before you ride your bike again in the spring.)
Another option to lower your premium would be to raise your deductible during the winter months. However, you need to understand the financial consequences of higher deductibles. For example, would you have enough cash on hand to pay the higher deductible if something were to happen?
Finally, ask your agent about bundling coverages (combining your personal auto, home, etc.) and consider taking a motorcycle safety course as additional ways to save on your policy. According to the III, many insurance companies offer 10 to 15 percent discounts for completing a motorcycle safety course.
So, talk it over with your agent. You may discover that there are some untapped opportunities to help reduce the cost of your motorcycle policy and still protect your assets.
This article is a basic summary of things to consider when purchasing vehicular service contracts; asset protection, credit life, credit disability and other similar types of insurance. The information presented is for information and educational purposes and meant to supplement other information specific to your situation. It is not intended as investment advice and does not necessarily represent the opinion of Protective Life or its subsidiaries.
Neither Protective Life nor its representatives offer legal or tax advice. We encourage you to consult with your financial adviser and legal or tax adviser regarding your individual situations before making investment, social security, retirement planning, and tax-related decisions. For information about Protective Life and its products and services, visit