I'm a new rider. Buying a used Honda CBR250R as my first bike. I was going through some insurance quotes in the area and wondering if I should get comprehensive/collision. Do I really need it for a used/small bike? What are your thoughts? Usually I would pay the extra but it makes a big difference here.
Insurance question
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Without comprehensive/collision is $150/yr and with its $800/yr - $300 deductible. These are just quotes, I'm sure they will add something to this when I actually by the policy.
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Without comprehensive/collision you are 100% responsible for repairs or replacement. With it you only pay your deductible. So it depends on the cost of replacement really. It's insurance. It's a gamble. They bet you will need it and you bet you won't. It's all up to you.
Next you have to look at how much the motorcycle is worth. (Blue Book or NADA value) That's what the insurance company will look at for replacement value.
If you look at the cost of insurance and deductible, a total loss being covered will put you at $950 a year out of pocket. If you took the same amount and stashed it away in a savings account, how many years would it take to just buy a replacement?
Of course if the motorcycle does get destroyed or stolen within the first year, you might be glad to have the coverage.
If you look at the cost of insurance and deductible, a total loss being covered will put you at $950 a year out of pocket. If you took the same amount and stashed it away in a savings account, how many years would it take to just buy a replacement?
Of course if the motorcycle does get destroyed or stolen within the first year, you might be glad to have the coverage.
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I insured my bike lightly and my body heavily...so things like medical coverage and uninsured motorist l paid for, while my bike coverage has like a $1000 deductible. The big dollars come into play with hospital bills, not replacing the bike, IMO.
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Others have mentioned the same advice, but it really comes down to cost of replacement and medical coverage. If you do not need the medical coverage and the replacement cost of the bike is easy for you to cover, then all you need is liability (assuming you own it outright, if you do not the bank likely wants comp and collision on it)
I will say I would definately get some other quotes. GEICO and Progressive seem to be the most common insurers, but also whomever you have home/rental coverage with and auto with.
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Also, l'm not sure what the law reads in NJ, but in Washington and many other states, insurance is not required for a bike.
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Do not limit yourself to just those carriers. Right now I have Geico insurance at far less than your quote even though I am riding a very heavy/powerful/expensive bike, a Victory Vision. When it is time to renew I don't just send in a check. I do a Google search and get all the quotes I can. Who knows what company will be my insurance next year, I sure don't. With a remaining value of over $15k, I find my total bill at around $400 as worth it to me. That is with a $500 deductible, and yes I wrote a check for that $500 last year when I messed up. It was my first accident in quite some time so my rate did not jump a whole lot. Insurance folks had made plenty of money from me for many years before that.
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insurance is a bit of a game.
Lets say you have a bike worth $5.5k and insuring it completely with a $500 deductible on top of liability costs an extra 250 a year.
5,500 - 500 = 5000 so this is how much you are insuring
Full coverage price - liability only price = $250 (for this example)
That means you are paying $250 for 5000 in insurance. or 5% of the value of the bike each year.
If you total the bike it costs you 500+ what you have paid in premiums to replace the bike. So if you total the bike in year 1, it costs you $750 to replace your 5k bike. In year 5 it is going to cost you 5*250+500=1750 to replace that 5k bike (that is not worth 5k likely any more and likely your premiums have gone up. but meh) Now the nice thing is that you have already paid out 1250 so immediate out of pocket is only 500, but you still will have paid 1750 up to that point.
Figure out where you break even. You could take that $250 a year and squirrel it away for when you have to replace the bike anyways and you would have 1750 as a downpayment in the above situation. The choice is yours.
Lets say you have a bike worth $5.5k and insuring it completely with a $500 deductible on top of liability costs an extra 250 a year.
5,500 - 500 = 5000 so this is how much you are insuring
Full coverage price - liability only price = $250 (for this example)
That means you are paying $250 for 5000 in insurance. or 5% of the value of the bike each year.
If you total the bike it costs you 500+ what you have paid in premiums to replace the bike. So if you total the bike in year 1, it costs you $750 to replace your 5k bike. In year 5 it is going to cost you 5*250+500=1750 to replace that 5k bike (that is not worth 5k likely any more and likely your premiums have gone up. but meh) Now the nice thing is that you have already paid out 1250 so immediate out of pocket is only 500, but you still will have paid 1750 up to that point.
Figure out where you break even. You could take that $250 a year and squirrel it away for when you have to replace the bike anyways and you would have 1750 as a downpayment in the above situation. The choice is yours.
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