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5 October 2023

Written by Katie Rollin

|  6 Minute Read

How is your Cycle Insurance policy regulated?

Cycle insurance has become increasingly important with the rising popularity of cycling as a for transport or recreation . Cycling insurance provides financial protection to cyclists in the event of theft, damage, or accidents. However, insurance brokers need regulation to ensure fair treatment and adequate coverage.

This article explores the workings of ALA Cycle Insurance, the need for regulated insurance brokers, the general rules for insurers, the Prudential Regulation Authority (PRA), and the Financial Services Compensation Scheme (FSCS).

Are cyclists required to have insurance in the UK?

Car insurance is a legal requirement, so the debate remains on whether cyclists should get bike insurance before cycling on UK roads. However, cycling insurance is not a legal requirement yet.

With the increasing number of bikes on the roads, getting insurance coverage may be a good idea if you ever need to replace a stolen bike or repair any malicious or accidental damage. Specialist bicycle insurance cover options can also protect you from public liability charges and certain legal, cycle hire or accessory costs. Bike insurance helps protect you from financial losses after an unfortunate cycling event.

How does ALA Cycle Insurance work?

ALA Cycle Insurance offers comprehensive coverage to cyclists. By paying a standard premium, cyclists are protected against bike theft, malicious and accidental damage, and have coverage for up to 30 consecutive days when travelling overseas. Additionally, ALA provides the option to add additional cover options, allowing cyclists to tailor their insurance policy to meet their specific needs.

Your policy lasts one year before you need to renew your bicycle cover. You can pay in one lump sum or monthly. If you ever need to make a claim, ALA handles it quickly so you can return to cycling as soon as possible. Our payout rates are higher than the industry standard.

ALA covers the costs of bicycle repairs or additional charges (covered by optional add-ons). If your bike needs replacing, we arrange this directly with the bicycle supplier.

Build a tailored Cycle Insurance quote: see the benefits for yourself.

Why do insurance brokers need to be regulated?

Insurance companies don’t have the best reputation. There’s a common stereotype of insurers finding loopholes to deny a customer’s claim or taking longer than necessary to reach an agreement. Nothing is more frustrating than paying a premium and encountering unexpected exclusions when making a claim. That’s why ALA are one of the leading insurers with claims handling, payouts and customer service.

We’re rated number one on Trustpilot for ‘Best In Cycle Insurance Company’ and ‘Best In Insurance Company’.

An older couple admiring the English landscape during their bike ride

Regulation is crucial for ensuring that insurance brokers operate fairly and ethically. Insurance brokers act as intermediaries between the insurance companies (underwriters) and policyholders. Brokers are responsible for managing policies, purchasing and marketing on behalf of the insurance company. All firms on the financial services register, including insurance companies and brokers, must follow standards and guidelines set out by independent regulatory bodies. Identifying whether a financial services company is regulated is the first step in making sure your insurer has your best interests at heart.

What are the general rules for insurers?

All insurers have a detailed set of rules that ensure they operate fairly, ethically and in the customer’s best interests. The most general rules for insurers include the following:

  • Prompt and fair handling of claims: insurers must settle your bike insurance claim as soon as possible because you could be left without a bicycle or left to cover repair or replacement costs. Policyholders must also get prompt assistance with, and updates on their claims.
  • Providing useful guidance: insurers should provide resources to customers on how to make a claim and ensure that policyholders understand the process, the requirements and their rights.
  • Fair treatment of claims: insurers can’t unreasonably reject a bike insurance claim or terminate coverage without reasonable cause.
  • Prompt settlement of claims: insurers should settle claims promptly once agreeing on the outcome. ALA settles every bicycle insurance claim within 48 hours of reaching a settlement figure.

These Financial Conduct Authority (FCA) rules help keep customers safe. The Financial Conduct Authority (FCA) is a regulatory body in the UK that oversees and regulates financial services. The FCA operates independently of the UK government and sets the standards for financial institutions. They supervise financial markets, protect consumers and encourage market competition. The FCA works to maintain the integrity and stability of the financial system.

Who is the Prudential Regulation Authority

The Prudential Regulation Authority (PRA) is responsible for setting the rules and regulations governing insurance companies and other financial service firms. Like the Financial Conduct Authority (FCA), the PRA ensures that insurers comply with the necessary standards and guidelines, helping to promote fair treatment, financial soundness, and consumer confidence.

Who is the Financial Services Compensation Scheme?

The Financial Services Compensation Scheme (FSCS) is a government-backed compensation fund that protects consumers in the rare circumstance that an insurance underwriter cannot afford to pay a claim . In this case, the FSCS steps in and pays on their behalf. The FSCS plays a vital role in safeguarding consumers and upholding the integrity of the insurance industry.

Why choose ALA Cycle Insurance

Identifying credible bike insurance providers is crucial in buying insurance coverage. ALA is regulated by the Financial Conduct Authority, and its underwriters by the Prudential Regulation Authority, Our policies are protected by the Financial Services Compensation Scheme protects all policies.

We’re ahead of the industry average for payout rate, and if you ever encounter an issue, our friendly team always strive to reach a positive resolution for customers. We’re happy to say that we receive very few complaints. However, in the very rare case that we cannot resolve your issue, the Financial Ombudsman Service is available.

Build an ALA Cycle Insurance quote today!

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