August 22, 2012
By Gina Roberts-Grey, InsWeb.com
Unlike car insurance, which is required of drivers in all states except New Hampshire, some states don’t require motorcycle riders to carry insurance. And even those that do require motorcycle insurance don’t have laws requiring motorcycles to be insured in the same way as cars.
So if you’re involved in an accident with a motorcycle, you might have to tap your car insurance to cover a claim.
The state of motorcycle insurance
Hawaii, Montana, New Hampshire and Washington don't require riders to carry motorcycle insurance, says Mike Barry, a spokesman for the nonprofit Insurance Information Institute. However, Washington does require motorcyclists to comply with the state's financial responsibility law, which says you need to be financially responsible for damages caused if you’re at fault. One way to do that is by purchasing motorcycle insurance, says Howard Mills, director and chief adviser of Deloitte LLP’s insurance industry group.
Motorcyclists in the states that don’t require insurance can obtain a bond (a certificate issued by an authorized bond company, insurance company or state department of motor vehicles) indicating that money or assets are available to pay someone in case of an accident.
In Florida, if you're a motorcyclist with a clean driving record, you don't have to buy insurance. However, motorcyclists may not be able to renew their motorcycle’s registration if they're involved in an accident and can't cover the related damage. Motorcyclists in the Sunshine State "would also be personally liable for any damages they might inflict on the auto driver,” says Kerry Kessler, head of the motorcycle liability unit at Kelley Kronenberg, a law firm in Miami.
In Oregon, Texas and Utah, personal injury protection (PIP), the portion of car insurance that pays your medical bills if you're injured in an accident -- regardless of who's at fault -- is required for cars but not for motorcycles.
However, no motorcyclist anywhere in the U.S. might be able to completely escape insurance. If someone has a loan for his bike, the lender most likely will insist on liability insurance. Liability insurance covers injuries or damage to other people or other property if you're at fault. A lender also may demand comprehensive and collision coverage. Wind damage, vandalism damage and theft are among the things that fall under the comprehensive umbrella, while collision coverage applies to damage caused to your motorcycle in a crash.
There is no one reason why motorcycle insurance isn’t required in all states, but weather might be a factor.
“In some states, the riding season for motorcycles is only six or seven months, as opposed to the 12-month driving season for cars,” Kessler says.
However long the riding season lasts, motorcycle insurance can come in handy.
“No matter where you are in the country, you will be responsible for damages from any accident you cause. So it’s a no-brainer to carry enough coverage to protect yourself and your family,” Mills says.
What’s at stake?
According to the National Highway Traffic Safety Administration (NHTSA), about 109,000 motorcycle accidents happened across the country in 2009. Motorcyclists are 25 times more likely to die and five times more likely to be injured than car passengers traveling the same number of miles.
Uninsured riders are at risk for serious financial loss, Mills says. And a collision with an uninsured motorcyclist could force an insured car driver to file a claim with his own insurer, even if he wasn't at fault.
If an uninsured motorcyclist is at fault for an accident that injures an insured car driver, the driver’s PIP (in states like Florida) would cover the claim up to the policy’s limits. “After that, if the auto driver carries uninsured motorist coverage, that would cover the claim up to the limit of this portion of coverage,” Kessler says.
However, uninsured motorcycle riders and their passengers are out of luck. “The coverage of the not at-fault car driver would not cover an uninsured motorcycle rider’s medical bills or damages,” Kessler says.
If both drivers were blamed for the accident, the uninsured motorcyclist could sue the driver’s auto insurer for medical bills and damages. “If the auto driver was found to be responsible for the accident, the driver’s liability insurance would cover the motorcycle rider’s medical bills,” Kessler says.
If you file a claim after colliding with an uninsured motorcyclist, your rates shouldn’t go up, as long as the motorcyclist was at fault. Most states prohibit insurers from raising rates or adding surcharges under these circumstances.
But be warned: If the accident was your fault, your insurance rates could jump 20 percent to 30 percent or more, depending on the severity of the claim.