Your renter’s or home insurance company possibly has some coverage for your bike but these type policies do not offer much coverage for bicycles and what they do offer is generally insufficient coverage and a claim will affect the home policy renewal premium.
Most home and renter policies only insure the bike for fire and theft at the insured premises. That means if your bike is stolen at the supermarket it is not covered. Also damage to the bike is rarely covered, so if you lay your bike down out on the road or trail any damage to the bike belongs to you.
If a home or renter insurance policy does have some coverage for your bicycle it will be for Actual Cash Value (ACV) which, while it might sound good, is the insurance company way of paying you as little as possible for your stolen bike. ACV is the bike’s value at time of loss minus depreciation, and depreciation increases year by year.
A typical home or renter’s insurance company claim adjustment looks like this.
Theft of a 4 year old bicycle valued at $3000.
$3000 X 70% (30% depreciation) = $2100 minus $1000 policy deductible = $1100 payment to replace a $3000 bike.
Remember that the 30% depreciation will increase 10% a year and will be 50% when the bike is 6 years old in which case the claim payment will only be $500 for a $3000 bike.
When shopping for a stand-alone bike insurance policy look for a policy that does not depreciate the bicycle value but is a “stated value, replacement cost policy”. That is insurance language for a policy that agrees on a “stated value” and will replace new for old any damaged or lost bicycles. If the bike disappears entirely you receive the “stated or face value” of the policy, less your chosen deductible, typically $100 to $300. Check the quotes from these companies : Markel Insurance Corporation, Velosurance Bicycle Insurance
If you are concerned about what a bike insurance policy covers ask for a specimen policy to review before purchasing the bicycle insurance. Call the company and discuss the policy with an agent and make sure the agent understands bicycles. A cycling insurance agent will make life easy if you ever have a claim because you will be speaking with another cyclist who will understand how your claim happened because he or she has probably experienced the same situation.
Doesn’t my bike’s warranty cover damages to the bike?
Bicycle warranties cover defects in the bike’s manufacture. This means that if a weld breaks or a frame cracks the manufacturer will replace the frame but if there is any sign of impact to the bike the manufacturer will claim “crash damage”, decline the warranty and offer you a crash replacement frame at a reduced price. While this is nice and because the damage was caused by an accident a bicycle insurance policy will pay for all damage repair or replacement costs as well as the labor cost to break down the damaged frame and build upon the new frame.