Motorcycle Insurance vs Car Insurance: Which is cheaper?

When getting insuring a motorcycle, many people think motorcycle insurance is pricier than car insurance. As much as they love the sleek freedom of their ride, they know that a motorcycle offers less protection than a car and no seat belts. They expect their rates to be higher as a result.

In truth, motorcycle insurance is much cheaper than car insurance. It depends on where you live, but on average, it costs half as much as insuring your car. The average motorcycle owner in the U.S. pays $702 in insurance, versus $1,566 for car insurance.

The reason isn’t about the injury rate but about replacement costs. A motorcycle is cheaper to replace than a car, and broken bike parts are cheaper to fix, too. 

Other factors that make it cheaper to insure a motorcycle:

• They’re often used seasonally, not in bad weather or at night.

• If you run into another vehicle, it doesn’t cause as much damage as a car.  

Location Affects Motorcycle Insurance Rates   

Although motorcycle insurance is cheaper, how much you pay varies widely. If you’re 18 and ride a BMW sports bike in California, you’re going to pay a higher price. If you live in the more sparsely populated Midwest or just cruise around town, you’ll pay less. 

Regional Cost Differences

Midwest states with wide-open spaces tend to have lower annual insurance rates:  

• North Dakota ($382)

• Iowa ($414)

• Wyoming ($439)

• Nebraska ($469)

• South Dakota ($472)

States with crowded cities or on the higher-density coasts have higher motorcycle insurance rates: 

• California ($1,360)

• Louisiana (1,175)

• Michigan ($1,083)

• New York ($969)  

Coverage Required in Most States  

Motorcycle insurance is mandatory in most U.S. states. You need core liability insurance to protect your finances if you’re at fault in an accident. If the worst happens, it covers bodily injury to the other driver and their property damage. 

The amount of liability insurance you’re required to carry varies by state. Most mandate at least $25,000 in bodily injury protection and $50,000 per accident, along with $10,000 for property damage. You’ll find your state’s coverage requirements here.

In contrast, Florida is more free-wheeling when it comes to motorcycle insurance. You’re only required to carry $10,000 in personal injury protection which can be covered by your existing health insurance.  

States may also require you to carry passenger liability insurance. If you’ve got someone along for the ride, this pays their medical costs if you’re at fault in an accident. Sometimes insurance for guest passengers is included in your main policy, so it’s worth double-checking.   

The Risks of “Going Bare”

Even if you live in a state with lenient requirements, you should think twice about “going bare” without insurance. Although motorcycles make up only 3 percent of registered vehicles, you’re 29 times more likely to be killed in a collision if you’re on a motorcycle. Should you injure someone, paying for their medical costs is a heavy burden.  

If you like feeling the wind in your hair, you have additional risk of head trauma by not wearing a helmet. Almost 40 percent of rider fatalities can be chalked up to not wearing a helmet. Some states have differing insurance requirements depending on whether you wear a helmet or not. 

Collision and Comprehensive Coverage

If you have a new bike gleaming with chrome or metallic paint, you’re going to need different insurance than if you ride an older bike. Here are some options to consider:

• Collision coverage pays for damage to your bike if you collide with something, whether it’s a building, car, or tree. You’re covered for repairs or a new motorcycle no matter who’s at fault. If you have a new, expensive bike, this coverage can hike your costs. You can lower them by raising your deductible—the amount you pay before insurance kicks in.

• Comprehensive insurance covers your bike for damage from a wide range of things, from hail and floods to falling objects.  Full coverage can add a few hundred dollars annually to your payments. It may be worth it if you’ve invested in custom options or have a fancy new model.

• A medical payment plan (MedPay) covers medical bills and many extras for you and your passenger if you’re injured in an accident. Even the most avid riders will admit there’s a higher risk of injury on a motorcycle. MedPay can cover not just medical bills but insurance deductibles, home nursing care, prescriptions, dental fees, and other budget-busters.

Adding a Motorcycle Endorsement

You can include insurance on a motorcycle on your existing auto insurance policy if your company offers endorsements. This is an add-on to the existing policy. It only works if the company is already in the business of insuring motorcycles. More commonly, riders buy a separate policy for their bike from a company that specializes in them.

If you do bundle motorcycle insurance with other policies, ask for a discount.

The Age Factor

Insurance companies take into account the age of the motorcycle as well as the rider’s age when coming up with a quote.

Experience pays off here: you’ll get a lower rate if you’re an older, skilled rider. If you’re in your 50s, your rate will probably be a few hundred dollars cheaper than the cost for an 18-year-old just learning to ride.

The age and type of motorcycle also factor in:

• If you’re a road warrior with a powerful sport bike, you might have higher insurance costs. Some models have higher-than-average crash rates that cause insurers to raise premiums. 

• The type of bike and engine size can affect your rates. Often, the larger the engine, the more you’ll pay. On the other hand, cruisers and touring bikes may be cheaper to insure.

• Some motorcycles are magnets for thieves, especially when new. They’re easier to steal than cars and can be stowed away in a van for a fast escape. Insurers sometimes quote a higher rate if a bike is a tempting target for thieves. 

The five most stolen brands in a 2018 study were:

1. Honda (8,260)

2. Yamaha (6,655)

3. Suzuki (4,882)

4. Kawasaki (4,861)

5. Harley-Davidson (4,769)  

If Your Bike is Stolen or Destroyed

If your bike is totaled in an accident or stolen, the payout you get depends on your plan. You may expect full replacement value but the insurance company only pays you a used price. That's why it helps to understand key industry terms in advance:

• Actual cash value

  : If you agree to this, the insurance company will pay you the market value of your bike when it was destroyed or stolen. That’s the used price, not the cost of buying a new one.

• Stated Amount

  : This means you’ll receive whatever amount you chose when you bought the policy.

• Agreed value

  : This pays the amount you agreed on when you bought the policy, which remains fixed over time. You won’t pay a deductible.

Stated amount and agreed value are the options usually chosen by owners of custom or valuable classic bikes.

Custom Insurance Options

There are many other ways to tailor your motorcycle insurance to your unique needs. You can get towing service, trip cancellation insurance, custom parts coverage, and uninsured motorist coverage, just to name a few.

Many bike enthusiasts like to customize their ride with aftermarket parts. These may not be covered by a standard policy. But you can get custom parts insurance that covers aftermarket add-ons if they’re destroyed or damaged.

For example, if you added custom fenders or specialized paint and they were damaged in a collision, they would be covered with customized parts insurance.

Tips for Trimming Insurance Costs

You can get a price break on motorcycle insurance by following these tips:

• You’ll save money if there’s a lay-up period during winter when a motorcycle’s in storage. You’ll still be covered for theft or damage, but you can’t take the bike on the road. 

• A bike with safety features such as anti-lock brakes will make you more secure and lower your rates. These bikes are less likely to be in an accident. The rate for fatal crashes is 

   for bikes with an ABS. Anti-lock brakes are especially important when you’re a new rider: insurance claims in the first three months drop by almost a third when a bike has an ABS.   

• You may get a lower rate if you have an anti-theft device on your bike such as a GPS theft-recovery system. 

• You can sometimes qualify for a discount if you complete a training course from the 

  .  

• Some insurers will give you a discount if you pay your annual premium in full.

• There’s often a discount if you insure more than one bike with the same company.    

As with all types of insurance, it pays to shop around. Sites like PolicyScout let you compare a dozen different plans and pick custom options with a few clicks of the mouse.

Although motorcycles are all about living free, it’s worth going the extra mile to find the right insurance plan. It brings you peace of mind even as you enjoy the scenery rolling by.