Insurance - Smoke and Mirrors...?

Insurance is clearly a grudge purchase and we all believe we don't need it - until we really need it! But, in motorcycling terms, is the insurance you have on your bike - and on your own body, really everything that its made out to be?

While almost impossible to believe, the number of bikers that ride without any form of medical aid, hospital plan or medical insurance is staggering. And the pandemic over the past two years has not helped either as many of us have had to cut-back on insurance and other grudge payments in order to make ends meet. But, almost as if in response to the situation, a number of products have come onto the market in recent years to address the needs of bikers who often prioritise their income - fuel, parts, helmet, medical - before taking appropriate cover.

Some of these products offer medical cover for emergencies such as a fall or accident, but this is generally limited to ambulance and EMS response and emergency-room cover. These are based on you having a medical aid that can carry the remainder of costs and they offer varying cover options for those that don't. And at a price.

Then you get products such as Hospital Plans that cover your in-hospitalisation costs to prescribed limits. Again, a very expensive option considering their exclusions and conditions. These are usually bought together with Gap-Cover products to offset the exorbitant costs charged to save a life.

Over the past few years, a number of products have appears promising to cover your emergency costs and hospitalisation for relatively low monthly fees. But as we have seen this month, one of the leaders in this field have stopped their motorcycle plan because bikers and bike incidents are so different from those associated with motorists.

In the first instance, these products offer the low subs because they are able to recover their costs from the Road Accident Fund and medical aids and thereby minimise their risk. However, as more than one scheme has found to its cost, bikes pose two specific challenges. The first is that by-far the majority of bike accidents don't involve another vehicle and this eliminates any assistance or funding from the RAF. So the 'insurer' carries the risk. Add to this, my opening statement about a high percentage of bikers don't have medical aid cover, and again, the 'insurer' has to swallow this cost as well.

Insurance rates are based on the best case scenario of claims across the entire 'book' of insured. If that 'book' cannot cover the cost of claims, it has two options - either raise fees to astronomical heights or close the book itself. And that is what is happening. Raising the cost of insurance is not going to gain traction in an already downtrodden market, so closure is the route being taken.

That leaves bikers in the cold when it comes to accident emergency cover. On it's own - and because of the claims history of bike accidents, insurers charge a premium for cover. However, when added to a package of other services and a philosophy of encouraging safer riding, the costs are negligible when compared. Guardian Angel is just this kind of service which includes safety, security and emergency medical guarantees specifically for bikers.

If you are one of those that is about to lose your emergency cover, call us and ride safer.

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