Why does the cost of motorcycle insurance cover vary so much?
Motorcycle Insurance Costs vary because Motorcycle Insurance Companies employ underwriting staff that are responsible for making sure that the company is protected as much as is reasonably possible from paying out too much money in claims to the policyholder or third party. Underwriters have a wealth of statistical information, and it is from this that they calculate the likely (risk) cost of insuring a particular vehicle for a particular individual. Each motor bike insurance company will have different experience on each model of motorcycle and so rates will vary according to either good or bad underwriting results. They may have teams that specialise in Honda Insurance, Yamaha Insurance, Suzuki Insurance and Kawasaki Insurance and other teams that may work just on providing rates for online motorbike insurance as its often the case that motorcyclists expect to get a cheap motorcycle insurance quote on the internet.
Your occupation:
If for example you commute into an inner city on a daily basis then statistically the chance of you being involved in accident are greater than a rider that just uses his motorcycle on sunny weekends and therefore your bike insurance premium may be higher.
Where you live:
If you live in a village location in a rural part of the country then statistically your motorcycle is less likely to be stolen than if you live in an inner city location and this could affect your motor bike insurance premium.
Whether your bike is garaged:
As you might expect, if your motorcycle is kept in a garage overnight then it is usually less likely to be stolen compared to a motorcycle that is kept on the road. You may find certain bike insurers either refuse to cover certain models unless they are garaged, or place a much higher excess on the policy in the event of a claim.
Whether you have any claims or convictions:
If you have a speeding conviction you may not be penalised at all by a motorbike insurance company, however if you have numerous motoring convictions, or you have made recent claims on a motor insurance policy then insurers may see you as a higher risk and could place a large percentage increase on the price of your motorcycle insurance policy, or in some cases refuse cover altogether.
No Claims Bonus:
If you have accrued a number of years No Claims Bonus on a motorcycle then you will usually receive a lower premium for your motorbike insurance policy compared to a rider that has no No Claims Bonus. Clearly, as you have had experience at riding a motorcycle and have not made a claim during this time the bike insurance companies would normally be very keen to insure you. Certain motorcycle insurance companies will only insure riders of certain models such as large capacity motorcycles if the rider possesses a minimum of 1 years No Claims Bonus. Therefore if you have not accrued any No Claims Bonus you may be better to research the cost of your insurance premium before you actually buy the bike!!
Benefits included in your motor insurance policy:
Certain motorcycle insurance brokers will offer you benefits including Legal Expenses Insurance or Breakdown Recovery as standard within your insurance policy. By adding these products as standard the broker will be able to buy in these policies from the provider for a far lower cost than if they were offering the policies as an option. Therefore if you buy your insurance with these extras included then the broker will ordinarily include a fee into the policy to cover the cost of the policy. However, it is becoming more commonplace for an insurance policy to be ‘naked’ i.e. the policy will not include extras such as Legal Protection Insurance or Breakdown cover. This way the broker can offer the customer a lower rate for the insurance policy and offer the customer the option of adding the ‘extras’ if they wish to.
The excess charge that applies to your policy:
Insurance companies issue policies that have a “compulsory excess” This figure is usually anything from £100 to £750, depending on the risk that the insurer believes you to be presenting. The excess can vary for example according to your experience or location or age, The “excess” is the amount that you are responsible for, in the event of you making a claim on your policy. For example, if you have a vehicle stolen and have a £100 excess on your policy then you will have to pay the first £100 for this claim. Certain motorcycle insurance companies will let you add a voluntary excess to your compulsory excess. You may be given the opportunity to reduce your cost of your annual insurance premium if you are prepared to pay a higher excess. For example you may be offered an insurance premium of £300 with a £100 excess, however you could add on £400 as a voluntary excess and reduce the price of the insurance premium to £220. If you believe there is a low chance that you will make a claim on your insurance policy then you may wish to explore this option.
Security (alarms, immobilisers etc):
Due to the rising number of motorcycle thefts with thieves targeting certain areas or certain models of vehicle, insurers sometimes make it a condition of your motorcycle insurance policy that an alarm or immobiliser is fitted on your vehicle. For example, if you live in an inner city area where there is statistically a greater chance of your motorcycle being stolen then you may be required to fit an alarm to your vehicle.