Thursday, October 6, 2016

Getting real serious now - Part 1

"It's better to have it and not need it
than to need it and not have it."

Sage advice that we've heard numerous times before. But thanks to Flo, Mayhem and that guy from Allstate, we sometimes get lulled into thinking it's better to 'cut back on insurance' and save... I'm just here to remind you that what you're saving on today is what your insurance company will probably save on later.... like when you have to file a claim. 

BTW: I'm not promoting one insurance company over the other, nor am I licensed to sell any type of insurance - these are just lessons I've learned on my own or through friends' experiences.

I talked briefly about motorcycle insurance earlier this year, however I've learned a lot more since then, so I'm going to cover all of what I know so far:
  • In New York, because of our short riding season, motorcycles
    are considered a recreational vehicle. That means what you're automatically covered with in your car may not be the same for your bike. Find out how your state clarifies your motorcycle.
  • Liability coverage is required by state law, however this type of coverage protects the other guy from damage or injury, not you. It is in your best interest to get 'optional' insurance coverage on your motorcycle policy.
Let me just pause here, because this is a BIG deal. The bare minimum, state required motorcycle insurance coverage is designed to protect the person you hit, not you. So, if the other person hits you, all you'll have is their insurance to pay for your damages and injuries. 

Now, follow along with me here, because chances are good that the driver who just hit you also has the bare minimum insurance coverage required by law - about 75% of drivers do - which is $25K bodily injury per person, $50K total bodily injury per accident (if you happen to have a passenger) in New York State. And no, you don't get to add those two amounts together.

Please THINK about that a minute!! Let's just say you're riding along when Nathan No-Look turns left in front of you (the most common motorcycle accident) and down you go. Your leg is badly broken, as well as a couple of ribs and wrist. All you can see of your bike is a pile of smoking metal. 

The paramedics arrive and call for a Life-Flight because you need emergency surgery - NOW. Of course you and your family members are wanting the EMT people to act quickly, plus you're in shock by this time, so no one is thinking of the cost that all this attention will add up to at the time it's happening. But don't worry, the insurance companies already have!

Anywho, the average cost of a Life-Flight is $15,000. "Well, I've got medical insurance, so I'm covered," you say. Think again. Most medical insurance policies cover life-flights at 50-60% (if the provider is in your network.... but you didn't think to ask that either), leaving you holding a $6000-$7500 or more bill.

Of course if the Life-Flight isn't covered by your health insurance, and you only have the liability coverage on your motorcycle insurance policy (which doesn't cover any medical costs for you!), then you can get stuck for the full cost of the Air Ambulance. At that point rates are usually calculated by the cost of jet fuel, type of aircraft, distance flown and staff on the flight, which can be anywhere between $2000-$50,000.

And that bill is just the beginning....
~continued in Part 2