Opting for a higher deductible value can lower your insurance premiums by as much as 30%. Choose it only if you are confident of avoiding large-scale repairs.
A full coverage motorcycle insurance policy includes many protective covers for the vehicle and the owner, which makes it a tad expensive, compared to others. How does one get an inexpensive insurance policy, in such circumstances? The simple answer is, by understanding underwriting and actuarial evaluation factors.When you purchase insurance for the motorcycle, you become a policy owner and have to pay a premium to the insurance company, based upon which, it covers or provides financial protection against unexpected expenses incurred as a result of any damages to the vehicle.
Now, when you become the holder of an insurance policy, the company views you as a potentially risky asset. It tries to assess the possibility and probability of you getting into an accident or the possibility of an expenditure being incurred. The premium depends upon the probability of the vehicle incurring damage. The rule of thumb is that more the probability or risk of damage, more is the premium amount. This concept of determining risk is known as actuarial science and underwriting. By knowing the factors that increase the risk and therefore, the premium, you may find out ways to reduce the amount.
Features of a Full Coverage Motorcycle Insurance Policy
A full coverage motorcycle insurance is the kind that provides a comprehensive indemnity or protection against future loss to motorcycle owners. The words ‘full coverage’ imply that it is granted for several losses or expenditures that may come up for the vehicle. The elements or expenditures that are covered are mentioned in the insurance agreement. Since there are more number of indemnities that are included in the policy, the overall cost of the policy often turns out to be high.
The standard cost of repair is covered by the policy and related costs such as that incurred for towing is also included. Some of the best policies also cover the costs of third-party repairs, if the insured person has been at fault.
Property damage is another element that is covered in such a policy. The damage to public property as a result of the motorcycle or any another damage to property, which is not a vehicle, is also covered.
The third important element is the liability insurance coverage. In cases where the motorcycle or its owner is responsible for damages, the liability insurance component provides coverage.
It must be noted that there are different instances, probabilities, and possibilities of the compensation being granted. Underwriters and insurance company representatives often consider several aspects before granting a compensation against the claims made. The compensation is also never fully granted and the insured person has to pay some amount, which is termed as the deductible.
To sum up, the most common features of such a policy include bodily injury and property damage liability coverage, collision coverage, uninsured/underinsured motorist coverage, personal injury protection (PIP) or no-fault coverage, comprehensive coverage (includes compensation for a stolen motorcycle), total loss coverage, and medical payments coverage. Some companies also offer custom parts and equipment insurance as part of comprehensive coverage. The more the damages covered, higher is the premium.