The freedom and exhilaration of riding a motorcycle has been a pastime in the U.S. for well over a century and many riders want to relive former glory days on a classic motorcycle. But before you run out and buy a classic bike, there are a couple things to consider when it comes to insuring it.
Depending on the classic motorcycle and what work has been done to it, you might find yourself paying much more for motorcycle insurance than you imagined.
Don't fret. The majority of classic motorcycles don't cost much more to insure than a new one. The standard coverages required by law in most states (bodily injury and property damage liability) cover damages to other parties - the policyholder has a bigger impact than their motorcycle itself when it comes to the price of a policy.
Optional motorcycle insurance protections, like medical payments and uninsured/underinsured coverage also are more dependent on the policyholder and other riders.
But coverages priced based on the value of a motorcycle itself are what set classic bikes apart from others.
The coverages that have the most significant impact on a classic motorcycle insurance rates are collision and comprehensive. Collision pays to repair or replace a policyholder's bike in the event of a crash, and comprehensive covers repairs or the cost to replace a bike for almost any other peril, including theft.
Chances are someone buying a classic motorcycle already has some idea of its value. If you don't, you need to do some research or have it appraised. You don't want to mistakenly over or under insure your motorcycle.
In some cases, it might be too difficult to determine the value of a classic motorcycle because it is considered too unique, valuable or has been customized.
For example, many limited edition bikes could be exceptionally hard to locate and replace or there might not be another on the market to purchase at all. Those also tend to be expensive - as much as $100,000 or more - and standard insurance companies might not want to take that risk.
A classic motorcycle might also have been customized over the years, which complicates its appraisal in the eyes of insurance companies. A factory-built classic motorcycle might be easy to insure, as long as it's listed in either the Kelley Blue Book or the NADA Motorcycle Appraisal Guide. But replacing newly fabricated parts presents a challenge.
The cost of customized parts, not to mention the labor to complete a bike with them, could make an inexpensive classic dramatically more valuable.
In either of those cases, an owner might need to purchase a specialty insurance policy for their classic bike.