Bicycle Insurance Not Keeping Pace with Rising Costs and Theft

The cycling boom got an extra lift during the pandemic, but new cycle commuters and hobbyists may find their insurance cover isn’t up to scratch.

Cycling has exploded in popularity over the last decade, with health and climate-conscious Britons swapping cars for pedals. As the pandemic cleared streets and kept virus-wary Brits away from public transport, cycling became more popular than ever. The Bicycle Association said retailers have seen a 60% increase in bicycle sales since March 2020.

This increased demand, combined with supply problems caused by Brexit and the pandemic, has nudged up the cost of bicycles. The Bicycle Association reports that price tags have risen by 26%. Road bikes now cost anywhere between £700 and £10,000, with accessories and safety gear such as helmets and lights increasing the bill.

These flashy, high-tech bicycles are manna for thieves. Insurer Admiral reports that thefts of pedal bikes have jumped by two-thirds since the start of the coronavirus crisis.

Many of those robbed of their bicycles won’t receive adequate compensation from their home insurer—or any payout at all.

Research from Defaqto has found that just 16% of home insurance policies cover bicycles outside of the home as standard. 

78% of home contents insurance policies will pay out if your bike is nabbed from your home. But one in eight policies excludes coverage even in this case.

Furthermore, insurers haven’t kept up with the accelerating price of bicycles, meaning your claim may not fund the purchase of a comparable replacement. Of the home insurance policies which include cover for bicycles, 20% limit cover to less than £1,000. 5% of policies won’t pay more than £500. 

Where policies do cover bicycles outside of the home, payouts may be even lower. These policies also come with strict exclusions, only issuing compensation for theft if your bicycle was securely locked with an industry-approved lock to an immovable object.

If you have an expensive bicycle, it’s worth reading the terms and conditions of your insurance policy before leaving it locked up outside a supermarket or even in your home. Some cyclists may want to add additional cover for their bicycles onto their home contents insurance policy, for an extra fee on their premiums. This is a popular add-on: Admiral reports that at the beginning of 2021 bicycles worth more than £1,500 were the most common high-value item added to its home insurance policies.

You can also seek out specialist bike insurance policies, which cover your bicycle separately from your home insurance. In that case, claiming for theft of your bike won’t increase your home insurance premiums when you renew or wreck your no claims bonus.