Specialty Motorcycle Risks Insurance

Bike sharing programs are becoming more popular as many individuals choose to diversify their transportation options. The beginning programs were municipal activities. As the number of programs has grown, for-profit companies are entering the business sometimes, as a vendor to the municipality or as an independent. The exposures include not only the injuries to the bicycle rider but also those third-parties who are injured by a bicycle while being ridden or while at a station.

Tourists often rent motor scooters and mopeds. The rental may be on an hourly, daily, or weekly basis. The insurance coverage sold to the dealer or rental agency covers the motor scooter or moped while it is rented. Liability is the only coverage usually offered because of the low value of these vehicles. The cost of the coverage is charged to the renter, but a master policy is issued to the dealer or rental agency.

Insurance on motorcycle dealers is usually written on modified auto dealers liability forms specifically adapted to motorcycle dealers. One coverage includes premises liability for sales operations in connection with service and repair of customers' motorcycles and motor scooters. Another covers motorcycles of customers while in the dealer's shop for repair, similar to garagekeepers legal liability coverage. A dealers supplemental physical damage policy covers the dealer's interest in its stock of unsold motorcycles. It covers the stock of motorcycles for certain named perils, such as fire, theft, collision, vandalism, riot, etc. Coverage may be written on a reporting form basis to cover the monthly fluctuations in values of stock.

Motorcycles may be rented on an hourly, daily, weekly, or longer basis. This insurance provides coverage during the rental period selected. Most policies provide only liability coverage. The cost of the coverage is charged to the renter, but a master policy is issued to the dealer or rental agency.

Liability coverage for damage an individual causes while using a rented scooter or motorized bicycle is not provided in the standard ISO homeowners policies. The rental agreement with the company providing the scooters or bicycles typically states that it has no liability for such accidents.

Following are some examples of Specialty Motorcycle Risks Insurance claims and the corresponding insurance coverages that can help pay for them:

1. Product Liability Claim: Suppose a customer purchases a motorcycle from the dealer, but later experiences a severe accident due to a faulty part in the motorcycle that was missed during the pre-sale inspection. The customer might decide to sue the dealership for selling a defective product. In this case, the Specialty Motorcycle Dealer Risks Insurance will help cover the cost of legal defense, any settlement costs, or damages awarded by a court, thereby safeguarding the dealership from significant financial loss.

2. Employee Injury Claim: A mechanic at the dealership might get injured while working on a motorcycle. If the mechanic decides to sue the dealership for failing to provide a safe working environment, the Workers Compensation section of Specialty Motorcycle Dealer Risks Insurance can help cover medical costs, lost wages, and any legal costs associated with defending against the lawsuit.

3. Customer Injury Claim: A customer may slip and fall while in the showroom or get injured during a test ride. If the customer sues the dealership for negligence, the General Liability coverage in the Specialty Motorcycle Dealer Risks Insurance will cover legal defense costs, court fees, and any damages or settlements if the dealership is found liable.

4. Theft or Damage Claim: If a high-value specialty motorcycle gets stolen from the dealership or is damaged due to fire or a natural disaster, the dealer could face significant financial loss. With a Property coverage in the Specialty Motorcycle Dealer Risks Insurance, the dealership can receive compensation for the lost or damaged motorcycles, allowing them to recover more quickly.

5. False Advertising Claim: If a dealership advertises a motorcycle with certain features that it does not have, and a customer purchases it based on this information, the customer might sue the dealership for false advertising. In this instance, the Specialty Motorcycle Dealer Risks Insurance can help cover the legal expenses associated with defending the lawsuit, including any settlement costs or damages awarded by a court.

6. Discrimination Lawsuit: If a potential customer feels they were treated unfairly or discriminated against while at the dealership, they may decide to file a lawsuit. The Employment Practices Liability section of the Specialty Motorcycle Dealer Risks Insurance would help cover legal defense costs, settlements, and court-awarded damages in such cases.