Motorcycle Insurance and Insuring Other Two-Wheeled Motor Vehicles

Motorcycle, moped, motorized bike, “pocket bike,” scooter — what distinguishes them, and what do you need to know to operate them legally? Do you need a special motorcycle insurance policy?

In the United States, no universal or official definition exists for these vehicles. States govern vehicle registrations and insurance, so definitions and requirements for licensing, registration and motorcycle insurance will vary state to state. The following article will provide some general guidelines, but the state’s department of motor vehicles can provide more specific information on legal requirements, and we can provide more information on insurance coverages.

Motorcycles

Generally, a motorcycle is a two- or three-wheel powered vehicle designed for on-road, off-road or dual-purpose (on and off-road) use. On-road and dual-purpose motorcycles must meet federal and state certification standards and be licensed (registered) for use on public roadways. Most states require owners/operators of motorcycles to carry insurance.

Mopeds

Most states define mopeds as lightweight, two-wheeled vehicles with smaller engines than motorcycles, often limited to a cylinder capacity of 50 cubic centimeters or less and with no manual gearshift. Regardless of weight or engine size, some states classify any two-wheeled vehicle that can go faster than a certain speed on a flat surface (typically 30 miles per hour) a motorcycle, and subject to the licensing, registration and insurance requirements for motorcycles.

Some states allow mopeds or light scooters to operate on public roadways without license or registration, as long as the operator is over 16. Others (such as Michigan) allow younger individuals to obtain a special moped license.

Many states also don’t require insurance for mopeds, although exceptions exist. (In Ohio, for example, if you use a moped or scooter on a public road, it must be “roadworthy,” operated by a properly licensed driver, registered and insured.)

Motorized bicycles

Like a traditional bicycle, a motorized bicycle has pedals that allow the operator to get around on human power. It also has a motor (gas-powered or electric) that can either assist the operator or propel the bike on its own. Some states consider them to be motor vehicles and require registration; they also limit the engine capacity to no more than 50 cc and speeds to no more than 30 miles per hour. Most do not require licensing or insurance, although some require operators to be age 16 or older.

Pocket motorcycles or mini-motorcycles

Also known as rocket bikes, mini-motorcycles are scaled-down motorcycles with gasoline engines. They can reach speeds of 45 miles per hour. Most states prohibit their use on public roads. As “toys,” they do not require licensing, registration or insurance. However, since they can be dangerous, we recommend having insurance coverage.

Insuring a Motorcycle: Two Options

Option 1

As with car owners, all states require motorcycle owners to carry a minimum amount of liability coverage. This pays for any bodily injury or property damage you cause to another person while operating your motorcycle.

Motorcycle owners who have a personal auto policy can add motorcycle coverage to their auto policy by buying a “miscellaneous type vehicle endorsement.” This policy addition extends your auto policy’s coverage to the motorcycle (or other vehicle) named in the policy declarations. If you own more than one motorcycle, you must name them all for coverage to apply. You can also use this endorsement to cover golf carts, RVs, mopeds and other private passenger vehicles that are not automobiles.

For some people, this endorsement might provide enough coverage. It has limitations, however. Obviously, you’ll need a personal auto policy in order to add the endorsement. More importantly, unlike the personal auto policy, the endorsement does not provide liability coverage when you use a vehicle you don’t own, unless it is a “temporary substitute” for the named vehicle. In other words, if you take a friend’s motorcycle for a spin, your policy won’t provide liability coverage.

Finally, many owners will find the property coverage under the endorsement too limited. The miscellaneous vehicle endorsement covers only the actual cash value of your bike, or the amount necessary to repair or replace it if damaged. “Actual cash value” does not mean what you would be able to sell your bike for on the open market—it means the original price, less depreciation. If you have a rare, collectible bike, a customized bike or one with many add-ons, the endorsement is unlikely to provide enough coverage.

Option 2

For many people, a specialized standalone motorcycle policy will provide the best coverage. Not only does its liability coverage apply in more situations, it can provide more coverage for a valuable or customized bike. Many specialized motorcycle policies provide “agreed value coverage.” With this type of coverage, you and the insurer set a price for the motorcycle when you buy the policy. If it is stolen or totally damaged, the policy will pay you this agreed amount, less any depreciation of tires, batteries and engine parts. This gives you better protection of your investment.

Insurance for Mopeds, Motorized Bicycles and Mini-Motorcycles

If my state doesn’t require insurance for these vehicles, do I need it?

State laws might not consider a motorized bicycle or mini-motorcycle a motorized street vehicle, but rather personal property. If this is the case, your homeowners policy might provide coverage for theft, loss or damage.

Although these vehicles operate at lower speeds than motorcycles, they can still cause bodily injury and property damage to another person. Standard homeowners policies exclude coverage for “bodily injury” or “property damage” arising out of the “…ownership, maintenance, use, loading or unloading of motor vehicles … owned or operated by or rented or loaned to an ‘insured.’” You can add this coverage for certain vehicles when you buy a miscellaneous type vehicle endorsement for your auto policy.