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Old 08-26-08, 07:44 AM   #1
speedlever
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Replacement insurance coverage for bicycles

Recent events have me considering how my present homeowner's insurance coverage deals with my bicycle. And as the bicycles seem to get more expensive the more I ride , the more concerned I am about being able to get replacement coverage (not Actual Cash Value) in the event of a loss.

This may vary state to state. In my state of NC and in particular with my HO insurance carrier, I have a $1000 deductible. My understanding is that I have replacement coverage, less my deductible. I believe the actual process is that they pay me the ACV (less the ded) and when I replace the bike, they pay the difference in cost between the ACV and the cost of the new bike. In effect, this limits me from using list prices, buying at a discount and pocketing the difference. Or so I understand. But I'm still out the amount of the deductible.

I got to looking at what it would cost to cover, for example, a $4000 bike under a separate policy (Marine Inland?) and I found the costs to be too pricey for me... around $300/year with no deductible, and around $280/year with a $50 deductible (the only option). With the way new bike costs are escalating each year, it wouldn't take but 2 or 3 years for that $4000 example to cost $5000.

So my options seem to be:
1) get a supplemental plan as above or
2) drop my HO deductible to $500 at an extra cost of ~$100/year on my current HO plan. That would limit my loss to $500 instead of $1000, but at a price.

Just curious what you folks do about this and if I've overlooked other viable options that may be more reasonable.
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Old 08-26-08, 08:10 AM   #2
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I think that if you want guaranteed replacement then it's going to cost. Automobile insurance (one of the more frequently used I suspect) would be priced out of sight if guaranteed replacement were in effect.

For most of my life, being made whole by the insurance co ment getting the current value of the damaged item. The only argument there is what is the expected depreciation of the damaged item. Antiques and other irriplaceable items (art, collectables) were always charged a premium rate.
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Old 08-26-08, 08:16 AM   #3
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I think that if you want guaranteed replacement then it's going to cost. Automobile insurance (one of the more frequently used I suspect) would be priced out of sight if guaranteed replacement were in effect.

For most of my life, being made whole by the insurance co ment getting the current value of the damaged item. The only argument there is what is the expected depreciation of the damaged item. Antiques and other irriplaceable items (art, collectables) were always charged a premium rate.
True enough. But I'm thinking of replacement coverage for things like photo equipment, TV, stereo, etc. If I'm not mistaken, those type things have replacement value coverage under many/most HO plans. And since bikes are covered under HO plans, not auto plans, I was thinking they would be too. But then I got to looking at the amount of deductible... which led me to look at supplemental coverage... which led me to question the group knowledge about the subject. Especially since I've learned that damage to a bicycle is much more likely than damage to my TV set.

Last edited by speedlever; 08-26-08 at 08:28 AM.
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Old 08-26-08, 08:17 AM   #4
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I have $500 deductible with full replacement cost on my tenant's insurance through Amica Mutual. New York State, BTW.

My previous carrier (State Farm) required a rider (insurance rider, not bicycle rider) for bikes worth over $1000.
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Old 08-26-08, 08:32 AM   #5
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If you were in the UK bicycle insurance would be easy.

http://www.eandl.co.uk/cycle-insurance/

https://www.jltonline.co.uk/secure/q...romCode=106185

Unfortunately your not. Your in the USA where bicycles are considered "Toys" and treated as such.
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Old 08-26-08, 08:39 AM   #6
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If you were in the UK bicycle insurance would be easy.

http://www.eandl.co.uk/cycle-insurance/

https://www.jltonline.co.uk/secure/q...romCode=106185

Unfortunately your not. Your in the USA where bicycles are considered "Toys" and treated as such.
I suppose there's good and bad where ever you live. In the above case, is there any deductible associated with the UK bicycle coverage? I like they have a 50+ plan!
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Old 08-26-08, 09:10 AM   #7
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I think we all know this already but its all about risk management. When viewed this way, we would spend more attention (and money) and use the pro-active approach.

The after-the-fact scenario isn't pleasant and not cost effective.
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Old 08-26-08, 09:30 AM   #8
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I recently went through this with a stolen bike and HO insurance. Although I had replacement coverage a different set of rules applied to very expensive items.
After establishing replacement cost and subtracting deductible I could:
1. Receive cash for that value minus depreciation
2. When I purchased a replacement bike I recovered the rest of the depreciation.

In my case the depreciation was considerable after 35 years. On the plus side steel frame bikes with chrome nervex lugs are still being built and considerably more expensive.

The deductible you just have to accept as your portion of the pain. Besides that I also dropped several hundred more beefing up security in my garage.
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Old 08-26-08, 09:49 AM   #9
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Originally Posted by tsl View Post
I have $500 deductible with full replacement cost on my tenant's insurance through Amica Mutual. New York State, BTW.

My previous carrier (State Farm) required a rider (insurance rider, not bicycle rider) for bikes worth over $1000.
Unfortunately, my insurance company went Clipless coverage and fell out of sight!
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Old 08-26-08, 10:25 AM   #10
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a good chain lock and in TEXAS a .45 or a 12 GA shotgun
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Old 08-26-08, 01:22 PM   #11
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I absolutely will not file any claim whatsoever against my homeowner's insurance policy unless the house burns down. Seriously, lots of folks have gotten burned (so to speak) for filing claims in the hundreds or low thousands of dollars, only to discover greatly increased premiums or policy cancellations or nonrenewals down the road. I carry $10k deductible and would raise it to $20K if I could.
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Old 08-26-08, 01:29 PM   #12
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I absolutely will not file any claim whatsoever against my homeowner's insurance policy unless the house burns down. Seriously, lots of folks have gotten burned (so to speak) for filing claims in the hundreds or low thousands of dollars, only to discover greatly increased premiums or policy cancellations or nonrenewals down the road. I carry $10k deductible and would raise it to $20K if I could.
Hmm. Raise that deductible high enough and you might as well just cancel that insurance!

While you raise a good point, it begs the question as to why even have insurance other than liability.

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Old 08-26-08, 02:17 PM   #13
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Our law makers and courts have made insurance almost useless. We definately need liability because of the courts but replacement insurance is if'y just ask the thousands of folks that lost everything in Katrina and got nothing from thier insurance. Your agent can be a major factor but not the final factor in settlements. I am sure the agents had no input in the Katrina frauds implimented by the companies and enforced by the courts.
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Old 08-26-08, 02:23 PM   #14
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Be very careful about your guaranteed replacement home owners policy. I had one...............now I don't..............somewhere in the fine print, the company stopped selling that.

Oh. since it was in the fine print and I didn't notice, and since the premiums didn't change, it was several years before I found out...

I changed companies on general principal................but I still don't have guaranteed replacement.

Don't you just love insurance companies?
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Old 08-28-08, 08:58 PM   #15
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Start a sinking fund, putting the difference between the full replacement coverage and the deductible cost in the bank. It won't be too long before you have enough to cover the deductible.
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Old 09-05-08, 01:44 PM   #16
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Quick update on the homeowners insurance issues discussed here.

After the above discussion, I asked my agent about insurance companies cancelling HO coverage after claims have been filed. The answer I got I did NOT like.

My agent says if you file 3 claims in 3 years, you'll be dropped. No matter whether the claim is your fault or not.

U-n-b-e-l-i-e-v-a-b-l-e.

Sounds like you're better off self-insured (to a point), other than for liability.
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