When someone talks about going outside your insurance company to pay for motorcycle collision repairs to your vehicle it kind of feels like cheating.  Depending on your situation, filing an insurance claim could increase your premiums costing you extra money every month.  Not to mention depending on the situation you might not get a bike as good as the one you wrecked with the money the insurance company gives you. 

The truth is that it’s very likely the insurance company will total your bike.  This is due to a combination of factors that we will discuss in this blog post.  The most important factor being the Actual Cash Value based upon the Fair Market Value. What we’re going to do today is discuss these concepts so that you can get a better idea of what you should do in your specific situation.  

American Auto Body and Collision is ready to help with your Motorcycle Collision Repairs

We here at American Auto Body and Collision are ready to help you with all of your motorcycle collision repairs.  That includes not only fixing your bike, but everything up to that point and after.  We want you to feel comfortable through this process and to make the smartest decision possible for you financially.  

That’s why we offer claim assistance to help you walk through the process of filing an insurance claim.  What we are discussing today is some of the factors that you may want to consider before filing your claim and getting your bike totaled. For more information or for any questions related to your claim call us at 918-323-4909 or email us at info@americanabac.com. 

Story Time

The best way we’ve found to describe these concepts is with a story.  Let’s say that you purchase a motorcycle for $15,000.  You decide to put some aftermarket parts on it – maybe some chrome.  The price tag is around $2000. In your brain you say, “Hey now my bike is worth $17,000 because $15,000 + $2,000 = $17,000.” and if I was going to sell it, that’s what I would price it as.

Then you are driving down the road one day and a truck pulls out in front of you and you have to swerve to keep from getting run over and…you lay your bike down. Not a fun situation.  Everyone is ok, but your bike doesn’t look so good.  You end up taking it to us here at American Auto Body and Collision. 

Now when you file your insurance claim the insurance company is going to ask these questions…

#1 What is the Actual Cash Value based upon the Open Market in your Area?

Your insurance company is going to look at your specific geographic location (in our case Tulsa) and attempt to locate bikes like yours on the open market.  They might search Craigslist or eBay and find a few.  Remember bikes and other vehicles depreciate over time so already your bike is worth about $11,000 on the open market.  

#2 What’s the price for repairs?

Now the insurance company finds a bike with similar (not identical) modification and sees it’s selling for around $12,000.  They look at the price of the repairs that need to be done to the bike and it exceeds 75% of the value of the bike.  So that’s when the insurance company decides to total the bike. 

What you’re left with…

Depending upon your insurance you might have done one of two things. You could have “scheduled” your insurance, or purchased gap insurance.

Scheduling your Insurance

Scheduling your insurance means that you set an automatic payout amount.  So in your case you would have set it to $15,000 because that’s what the bike was worth at the time you purchased it.  So in your case, you could get by with only losing the price of your modifications.

Gap Insurance

You might have also purchased gap insurance.  This would look at the difference between what you owe and what you’ve paid.  Let’s say you financed the bike, but you still owe $13,000. Since the value of the bike on the open market was priced at $12,000 you will be left with a “gap” between the sale (value) of the bike and how much you owe.  

That’s where gap insurance comes in and makes sure that the extra $1,000 gets paid for and you don’t have to keep paying on something that is no longer around. (Talk about a hard payment to make.)

Out of Pocket 

In and among all these intricacies and special cases is your situation.  Somewhere between all of this it becomes more financially logical to just pay the money out of pocket and fix the bike you have rather than try to find a new bike.  

American Auto Body and Collision is here to help you with your Motorcycle Collision Repairs!

We here at American Auto Body and Collision are here to help you understand all the ins and outs of your specific situation and provide you with the best quality service possible.  Take the time today to call us at 918-323-4909 or email us at info@americanabac.com with any questions you may have about your motorcycle. We will help you get from a bad collision to a good condition in no time.

The first thing we will do when you come in is give you a full detailed inspection of your vehicle from top to bottom.  We want to make sure you get a view of all the damage to your vehicle.  This will be the basis of all the future actions we suggest. Check out some of our testimonials here on this page. 

Motorcycle Tank Repair Testimonial

References: https://www.motorcyclelawgroup.com/news-resources/bike-worth-probably-less-than-you-think/