Handling Bike Damage Claims
A critical issue with almost all bike claims is how the property damage is paid and resolved. Here is the process.
- Presentation: The insurance companies never have an adjuster actually inspect the bike. (I’ve had it happen twice.) So, in order to make a bike claim, we must submit high quality photos and cost information for not only the bike, but all other items that were damaged (helmet, kit, shoes, phone, computer, etc.) Having an estimate or work order from your local bike shop is also very helpful. This is sent into the adjuster.
- Response Time: Insurance companies are usually confused with bike claims. They are set up to quickly handle car damage claims, but adjusters just don’t know how to deal with expensive bikes, and more importantly, how each bike is almost a custom bike for a specific rider when taking into account make, model, size, color, gruppo, etc.
In general, it takes at least two weeks before I can expect a response to the property damage claim. And it can take longer.
- Offer: About 60% of the time, the insurer pays the full amount. About 30% of the time, there will be some negotiation in which the adjuster wants to take depreciation. (I have arguments as to why depreciation does not apply.) Less than 5% of the time, the adjuster has no idea of what he/she is talking about, and the offer is ridiculous. (In those cases, filing suit is an option.)
- What I Do: I handle the presentation and negotiation of the property damage claim. You provide me with pictures, estimates, receipts, estimates and other documents necessary to substantiate the claim.
- What I Charge: Zero. I charge nothing for the property damage claim (if I handle your bodily injury claim). If the insurer pays $10,000 for your property damage claim, you get $10,000.
- Replacement vs. Repair: Sometimes it’s obvious that the bike needs to be replaced because the frame is in three pieces and many of the components are bent or scuffed. Other times, especially with carbon frames, it’s not so obvious. I understand that riding crashed carbon is usually not a good idea. We can usually get your bike store to provide a statement to that effect, and that is usually successful in getting the bike/frame replaced.
If the frame is solid, then getting repairs paid for is usually no problem.
- Depreciation: If your bike is more than two years old, you can expect that the adjuster will see a reduction based on depreciation. I understand that even though the bike is a few years old, most cyclists not only maintain their bikes, but often upgrade components, wheels, handlebars/stem, etc. such that your bike is actually worth more than what you originally paid. I use this and other arguments to minimize depreciation. Often they work, sometimes they don’t.
- Comparables: Adjusters might try to use listing on eBay and/or Bicycle Bluebook to justify lower offers. I have quite a few arguments as to why eBay and Bicycle Blue Book does not reflect the value of your bike, i.e., can’t “kick the tires”, counterfeits, lack of warranty, don’t buy used carbon, not really comparable (wrong frame size, different gruppo, etc.).
- Retention/Salvage Value: In 98% of the cases, the insurer does not seek to take possession of the damaged bike after payment. It’s not likely but it is a possibility.