How Much Coverage is Enough?
Remember – there is no such thing as a “full coverage” policy. The most anyone can ever be covered for by their policy is defined by the “limits” of the coverage. This works both ways. For Liability Coverage – you will only be protected against claims by others up to your liability limit. The rest of the “bill” comes out of your pocket – or your hide. For Uninsured or Underinsured Motorists Coverage – no matter how bad you are hurt, or what your case is worth, you will never get more than your UM/UIM Coverage limits.
How much is enough? For Liability Coverage, it is true that part of the answer to that question depends on how much you have to lose. But if you like your bike, your house, your paycheck and your driver’s license, you better insure against losing them. Typically, motorcycles do not do as much damage to the other guy as cars do. But if you put your bike through the door of a car at 60 miles an hour it does not take much for the people in the car to run up a small fortune in medical bills and lost wages, let alone their pain and suffering claim.
For Uninsured or Underinsured Motorists Coverage – remember – this is coverage for what happens to you. Do you want to sell your claim short? I can’t begin to tell you how many “million dollar” cases I’ve handled where the person only got a fraction of that, because that’s all the insurance there was. There is no “magic fund” out there to take care of you – you have to take care of yourself by having adequate coverage.
For Personal Injury Protection Coverage – This does depend somewhat on your health insurance picture. If you have great health insurance, you don’t need as much PIP. But what if you lose your job? What if your company “downsizes” your health insurance? PIP is cheap, and it is a life saver when you need it.
So how much insurance should you have?
In my opinion, you should not be on the road unless you have these minimums:
1. Bodily Injury Liability Coverage
$100,000/$300,000. This means One Hundred Thousand dollars for each person who is injured, up to a total of Three Hundred Thousand dollars for everyone hurt in one wreck. This may seem like a lot, but as I said, modern medical treatment is expensive – medical bills and lost wage claims alone can add up faster than you can imagine.
2. Property Damage Liability Coverage
The state minimum is $10,500. Are there any cars or bikes out there on the road worth more than that? Absolutely! Think about how many new cars cost more than $25,000 these days, and you will see that you need at least that much in Property Damage Liability Coverage, and you ought to have more to be really safe.
3. Uninsured/Underinsured Motorist Bodily Injury Coverage
Think back to “Wreck #3.” How much would you want to be paid for that experience? That’s how much UM/UIM Coverage you should have. The law says that your UM/UIM can’t be higher than your Bodily Injury Liability limits, so high UM/UIM limits aren’t cheap. But, again, $100,000/$300,000 should be the smallest policy you consider.
4. Uninsured/Underinsured Motorist Property Damage Coverage
What’s your bike worth? Uninsured/Underinsured Motorist Property Damage is not as important if you have Collision Coverage, but there may be some price advantages to having this – ask your agent.
5. Personal Injury Protection (PIP) Coverage
Don’t even leave your house without $50,000 in PIP. Unless you have great health insurance. Or unless you like paying medical bills out of your own pocket.
6. Collision Coverage
You need to cover the real value of your bike, cover the value of your modifications, cover the value of your accessories, and cover the value of your loan. Why end up “in the hole” when an accident happens? Unfortunately, there is a pretty good chance that at some point in your riding career you’ll need this coverage. Be sure you understand what you have before you need it. And don’t try to save a buck by having a high deductible. Do you really want to have to come up with the first $1,000 or more after a wreck? Odds are you’ll have plenty of other needs for that money.
7. Comprehensive Coverage
Ditto Collision Coverage.
8. Towing/Storage Coverage
This coverage isn’t that expensive, and it covers bills that are really annoying to have to pay out of your pocket. Get at least $100 or so for towing, and 30 days worth of storage.