What is a totaled motorcycle?
A motorcycle is considered totaled when it needs repairs that exceed its actual cash value. In the world of insurance, a motorcycle in this condition would be considered a "total loss." If your motorcycle is totaled and covered by your motorcycle insurance policy or another motorist's liability coverage, you may receive payment for the actual cash value of the bike.
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How does an insurance company determine the value of a motorcycle?
Motorcycle insurers typically do more than just assess the age, condition, mileage, and market value of your bike. Your motorcycle's actual cash value is determined based on a mix of authoritative estimates, such as valuations listed in independent vehicle value guides and current prices for similar motorcycles in your area. The actual cash value can also account for depreciation and supply and demand, among other factors. Your insurer also may factor in modifications and upgrades when figuring your bike's value.
Pro tip:
Most new motorcycles lose around 19-27% of their value in the first two years, with a 5% decrease happening as soon as you drive it off the lot. Bikes depreciate more slowly as they get older, but their value continues to drop as they age and rack up mileage.
How does a motorcycle insurance policy cover a totaled motorcycle?
There are several motorcycle insurance coverages that may pay to replace your totaled bike:
Comprehensive coverage: If your motorcycle is totaled due to an incident beyond your control, such as theft, vandalism, weather, fire, or a collision with an animal, comprehensive may cover the actual cash value of the vehicle, minus your deductible and regardless of fault.
Collision coverage: If your bike is totaled in a collision with another vehicle or object, such as a tree, fence, or guardrail, collision may pay you the actual cash value of the vehicle, minus your deductible and regardless of fault.
Liability coverage for property damage: In an accident in which another motorist totals your motorcycle, their property damage liability coverage may pay you the actual cash value of your bike, up to the limits of their policy and with no deductible.
Uninsured/underinsured motorist property damage coverage: When your bike is totaled in an accident and the at-fault motorist has no insurance or not enough coverage, UMPD or UIMPD may cover the actual cash value your motorcycle. UMPD/UIMPD isn't available in every state.
What is total loss coverage on a motorcycle insurance policy?
Progressive offers total loss coverage in cases when your bike is no more than one model year old on a new motorcycle policy, and two model years old during a renewal of a policy. If your motorcycle is deemed a total loss in a covered incident, we'll pay you the full manufacturer's suggested retail price, minus your deductible, instead of the actual cash value. Note that when your bike is no longer eligible for total loss coverage at renewal, Progressive will still cover the actual cash value of the motorcycle.
Example:Six months ago, you bought a new motorcycle for $25,000. It's now valued at $20,000, due to depreciation. If you total your bike and the latest model costs more than $25,000, we'll pay you that amount.
What happens if you total your motorcycle and it's uninsured?
Because you may be continually investing in your bike, leaving it uninsured may be costly. While you're no longer required to carry comprehensive and collision when your bike is paid off, those coverages safeguard your ride against physical damage. If you drop comprehensive and collision and your motorcycle is totaled, you won't be compensated for the value of the motorcycle unless another party was responsible for the damage.
What to do with a totaled motorcycle
When your bike is totaled, you have several options:
Keep the totaled motorcycle, which may result in a lower payout from your insurer due to the bike's expected salvage value.
Sell it to a salvage yard or to a private party.
Transfer the title to your motorcycle insurer and let them handle the disposal.
Rebuild your bike.
Donate your motorcycle.
Scrap the vehicle for parts.
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