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Cycle insurance explained: calculations

Owning and using a cycle has become increasingly popular and important, not just from an environmental perspective but also because cycling has incredible economic and mental/physical health benefits.

So, if you’re a keen and regular cyclist or someone who is new to the activity but think you will stick with it long-term (perhaps as a new method of commuting to work) then you could benefit from some cycle insurance.

In this guide, we will explain what cycle insurance is and how a cycle insurance premium from ALA is calculated.

What is cycle insurance?

In the event that your cycle is stolen and/or damaged, either accidentally or maliciously, standalone cycle insurance will cover the expense of repairing or replacing it, up to the sums insured. With an optional extra like personal accident cover, it may also support you financially if you are hurt following an accident while out riding the insured bike.

Your home contents insurance policy may provide coverage for your bicycle against theft or damage on your property, for a limited cover (often around £250). However, your cycle likely won’t be covered on your home insurance if it is stolen or damaged away from your property—but cycle insurance will.

How is a cycle insurance premium calculated?

When choosing your cycle insurance cover, a number of things will need to be taken into account. The first will be the current value of your cycle. The maximum value permitted for an ALA cycle insurance policy is £6,000. If your bike was bought new, this will need to be the undiscounted recommended retail price. If the bike was second-hand, you will need to provide an estimated current replacement value.

You will also need to provide the level of excess you would like. This is the amount you would need to pay in the event of a claim, and a higher excess will mean a reduced premium. ALA offers three levels: £250; £150; and £50. You should choose whichever is the most affordable for you.

A good bicycle insurance policy should be customisable and personalised for your specific needs. With ALA cycle insurance, you will be offered coverage for theft of and/or damage to your cycle as standard. You can also upgrade your policy to include the following add-ons, for an additional premium:

  • Personal accident cover will provide a financial pay-out if you are involved in an accident while riding the insured cycle that leads to the loss of a limb, loss of eyesight, permanent total disablement or death. We offer two levels of cover: £10,000 or £25,000.

  • Cover for the theft of and/or damage to accessories, including those added or fixed to the cycle as well as those included in the manufacturer’s specification. We offer two levels of cover: £300 or £900.

  • Cover for the cost of replacement cycle hire, up to the amount specified in your schedule of insurance, from a recognised reputable dealer while you are waiting for your primary cycle to be repaired or replaced. We offer two levels of cover: £500 or £1,000.

Other optional policy add-ons include legal expenses and public liability cover .

It’s important to bear in mind that the more add-ons you include in your cycle insurance policy, the more expensive your premium will be. So, make sure to only purchase the add-ons you really need for your cycle.

Frequently asked questions

Can my bike still be insured on a cycle insurance policy if I am not the policyholder?

In order for ALA to cover your bike, the proof of ownership must be provided by either yourself or a direct family member. ALA will also cover your bike in the event of theft while it is on loan to a direct family member.

Why do people choose cycle insurance instead of bike cover on home insurance?

Coverage for bikes is not always included on a home insurance policy, and in many cases is considered an add-on leading to a higher premium. With this type of coverage, your bike will usually only be protected while it is on your property, meaning it will not be covered for theft and/or damage when you are using it away from home.

A specialist cycle insurance policy will not only be much more personalised to your needs and circumstances but will also provide a much more extensive level of cover. This is particularly beneficial if you have an expensive bike that would not be totally covered on your home contents insurance policy, or if you want to take your bike on holiday with you and need worldwide cover.