So, the child has just been treated to a very nice but secondhand Nukeproof Megawatt. I'm not at all jealous as it's a far nicer bike than I've ever bought myself but hey...
Looking to insure it and, despite my years of commercial underwriting experience, am a bit confused as to whether we declare the secondhand value or the new value.
I'm very happy to insure it for what we paid for it however I don't want the insurer to then apply averaging to any claim if they feel it was underinsured.
Can anyone help me out?
Depends on the policy. If it’s not clear I phone them to confirm
With Pedal Cover you insure for the new cost (and that's what they pay out, rather than deducting for wear and tear).
I did get caught out myself by accidentally under-insuring a bike that took some damage in a crash (I have accidental damage cover to). I hadn't properly accounted for the cost of upgrades I'd done and for some I'd deducted an amount based off the cost of the item that I was upgrading from (as in my head over-valuing was a bad thing to do) but when it came time to claim I was told I should have valued based on just the new cost of everything fitted and not deducted anything for replaced items (which makes more sense in hindsight as they pay out based on the cost of what's fitted not what it once was!).
So they did pay out a bit less as a result but my fault and was a bit stupid as my premium didn't rise by adding a few grands worth of new bikes let alone slightly increasing the cost of existing ones. I also switch wheelsets between bikes so have valued each one now based on it having the most expensive wheels fitted at time of accident/theft.
With Pedal Cover you insure for the new cost
Yeah, but that's another issue. The RRP on one of my bikes is big, but no-one buys them at that price and it was 50% off when I got it. Still available at around that price as well.
So what to insure it for? RRP or actual price?
In OPs case the bikes are secondhand which adds another level of complexity.
Most of the bikes we have in the fleet are secondhand - one of them is a 2014 Anthem 0 which was £5k new. I've got it listed in the classifieds for £500 having paid £600 for it a couple of years back.
I'm not interested in having a new one, I'll just claim up to 500 quid if it gets nicked which is the standard cover for non-specified bikes. But there is an issue whether the insurer will pay out - and if I crash it/damage the frame there's also the issue that I've not insured the true cost of a replacement frame.
Always best to discuss with your provider.
I bought a used Cube Hyde Race on eBay for £400 and when it was stolen Halifax covered the new price of £1000. That was under the value where it had to be a named item though (I think it's £2k on my policy).
I have my current bike as a named item insured to it's sale price of £3999, rather than the RRP of £6000.
Does the insurance company need proof of purchase when paying out a claim?
if so then the purchase price will more than likely be the amount they will pay out
Think I've got it sorted. I took the old fashioned route of reading the policy wordings etc and most wanted the actual price paid for secondhand bikes.
I'm a little embarrassed to admit I've probably written more policy wordings than I've read!
Didn't go with Pedal Cover as for proof of purchase they wanted a receipt from the likes of eBay or a reputable retailer.
Others are happy with proof of ownership, that being a dated photo of the bike together with driving licence for eg.
I've also taken screenshots of the Facebook ad, my chat with the seller and the bank transfer from my wife's account to his.
It was cheaper than I thought it would be too which is a bonus.
What you insure it for is what the policy covers you for - new for old means current replacement value, regardless of what you paid for it.
Honestly, blooming underwriters, leaving it the claims dept to sort it out when it all goes wrong... 😉
What you insure it for is what the policy covers you for - new for old means current replacement value, regardless of what you paid for it.
Honestly, blooming underwriters, leaving it the claims dept to sort it out when it all goes wrong... 😉
Looking at the wordings it's a little more nuanced than that.
Most seem to be on a new for old basis for bikes owned from new and under 3yo.
After that it's FMV based on secondhand purchase price with the purchase price being declared at time of quote.
Blooming claims guys 😉
I insured our bikes last year with Pedalcover as they had a 50% off deal and the actual new for old cost of our 5 bikes was way above any of the household policies.
Today, I've chosen a different tack and gone with Admiral who will cover you up to £11,000 with the most expensive bike allowed being £5,800.
So instead of insuring all 5 bikes I have named 3 (£11,000). The other two in a worst case scenario would get £350 each.
Our bikes live in the house and never left locked outside anywhere.
The insurance includes away from home in our capmervan and added a grand total of £21 to the policy 🙂
Reading the policy wordings etc and most wanted the actual price paid for secondhand bikes.
Which company was that wording from?
Reading the policy wordings etc and most wanted the actual price paid for secondhand bikes.
Which company was that wording from?
Cycleplan was one, Eversure another. Cycleplan define it all under the 'indemnity value'
Ta - will have a look. I've always put mine on home policy but always looking for other options.
Honestly, blooming underwriters, leaving it the claims dept to sort it out when it all goes wrong...
I'm just pleased no-one is blaming the broker who sold the policy...
