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Is your Motorcycle Covered Correctly? 3 types of Loss Settlement for Motorcycles Insurance companies generally do not offer all three-loss settlement types - instead, the loss settlement type they have available to them is based on the type of motorcycle they own. 1. Actual Cash Value (ACV) If a customer owns a mass-produced motorcycle that has a resale value generated by a third party like the N.A.D.A. appraisal guides or Kelley Blue Book, they will generally be offered an Actual Cash Value (ACV) settlement option. This means that, in the event of a total loss or if their bike is stolen and not recovered, they will generally be paid the ACV, less their deductible amount. If a customer owns a custom or classic motorcycle with certain characteristics, they might find that some companies won’t insure their bike. However, many insurers that specialize in motorcycles will insure these types of bikes and will generally offer one of two loss settlement types - Agreed Value or Stated Amount. Criteria for these settlement types vary by insurance company, and no insurance company offers both types. For example, Progressive offers motorcycle owners a policy with Agreed Value if they have bikes that are 25 years and older or custom bikes that don’t have resale values in a N.A.D.A. guide or Kelley Blue Book. Many other insurers only offer Stated Amount for bikes with similar characteristics. Here’s what your motorcycle-owning customers need to know: |
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2. Stated Amount Stated Amount is the amount selected by the bike owner at the time the policy is purchased and is the maximum amount the insurance company will pay in the event of a claim. If the bike is totaled or is stolen and not recovered, the insurance company will generally pay the Stated Amount or the ACV as determined by sources like N.A.D.A. or Kelley Blue Book, whichever is less. And, a deductible applies to the settlement amount. 3. Agreed Value Agreed Value represents the value of the bike as agreed upon by the customer and the insurance company when the policy is written. This amount doesn’t change over time unless both parties agree to the change. If the bike is totaled or stolen and not recovered, the customer will generally receive the agreed upon amount. No deductible amount applies to an Agreed Value settlement. Do not use the Internet for the value of your bike. Always get an appraisal for your motorcycle. This will give the correct value and coverage for your motorcycle. One of the best settlement options is Agreed value policy. Always update the value on your motorcycle policy once a year. If you have insurance questions please call Lester Robinson at 1-800-836-2040 or e-mail at lrobinson@thenorthwoodscorp.com For a quote on your Auto and Home Insurance call Lester Robinson at 1-800-836-2040 ext. 3014 or go to website at http://www.wnyinsurance-quote.com/html/quotes.html Lester J. Robinson III, FICF, CC Insurance Broker The Northwoods Corp. 8810 Main Street Williamsville, NY 14221 Phone: (716) 626-0004 Ext. 3014 Fax: (716) 626-5057 Att: Lester lrobinson@thenorthwoodscorp.com See “the ABC’s of Insurance” TV show on Time Warner Cable channel 20 in Western New York hosted by: Lester Robinson Lester J. Robinson III, FICF, CC lrobinson@thenorthwoodscorp.com See “the ABC’s of Insurance” TV show on Time Warner Cable in Western New York hosted by: Lester Robinson |
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