Some years ago I wrote a piece about The BLS – The Boring Legal Shiiii…er… Stuff – that regular road cyclists ought to think about. Adventure Cycling picked up it… One day I got a call someone at the Wall Street Journal to talk about it! What a thing.
I updated this piece in early 2020, but … stuff happened in 2020 – in fact, I spent much of 2020 in litigation with insurance companies, talking with UtilitySavingExpert, over the terms of insurance policies… and I spent a considerable amount of time reading the longe run-on sentences that you find in insurance policies and trying to figure out how to make insurance polices apply to crashes involving cyclists…
sooo… since I had to suffer… [er…no… that’s the wrong approach …]
In light of my 2020 Experience in the exciting new adventure series Alice in Insurance Land, I think it’s actually a pretty good time to update this piece again. So let’s re-visit the BLS and make sure folks really GET It – or at least Get how freaking COMPLICATED and troublesome this can be!
WHAT IS THE BLS?
What is the BLS? The BLS is the Boring Legal Stuff you need to think about BEFORE you hop on the bike and ride. Basically boring stuff like INSURANCE and even Estate Planning. In this piece we’ll talk about … YAWWWWWWNNNNN…. INSURANCE.
What happens if you crash? What if someone runs you over? What if YOU clobber a pedestrian and get sued – or more likely – what if you crash with a car or motorcycle & they blame YOU for causing the crash while you think the other driver was at fault??
When you are loading your panniers and lubing your chain in preparation for your multi-state tour what data should you take with you? The failure to think about the BLS NOW can end up costing you time, money, safety and peace of mind.
So what insurance do you have in place?
Do you even know what your policy limits are?
What SHOULD you have in place to protect YOU if you get WHACKED?
Let’s do a Deep Dive into The BLS!
THE BLS – PART ONE – INSURANCE PLANNING
WHAT DO YOU HAVE TO LOSE?
Insurance is definitely not cheap. It’s an expense… a cost of doing business in the Game of Life. Insurance is about YOU though… protecting you and protecting your assets. If you have no job, no savings, nothing to lose if you screw up and get sued then maybe you don’t need insurance.
If you have a job, you work hard, you are trying to save for retirement or college, you need every dollar you make to survive and live the kind of life you want… then you should think about the potential LOSS of that security in the event of a crash. The odds that you’ll be involved in a Bike crash are not high… millions of people ride 1o’s of millions of miles every single day… and MOST return home safely after a fun ride…
But… there is RISK… and insurance is all about RISK and managing risk… and math… and your tolerance for Risk.
What do you have to lose if you ARE involved in a crash that is not your fault? If you are hit by a car? Attacked by a dog? If you are put in the hospital? If you can’t work? If you have mounting bills to pay? If you lose your job? If your family loses YOU? What do you have to lose?
You need to think about – to measure that potential loss – and make a decision about whether you want to try to protect yourself? Insurance is designed to do that- to protect you and your family in the event of that loss.
What kinds of insurance can help a cyclist? What should you think about BEFORE you hit the road?
HEALTH – AUTO – UMBRELLA – DISABILITY – HOMEOWNERS
Take your health insurance information on EVERY ride. Keep it close at hand. Better yet, make a copy of your health insurance card, your driver’s license, a list of medical allergies and your emergency contact information and stick it in a small baggie that you take with you on every ride.
A few years ago I created a business card that had a space for folks to write down this information…
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[SIDENOTE from the Department of Shameless Self-Promotion: If you want one of my handy dandy “BIKE LAW” cards for your baggie just send me a note & I’ll ship some to you!]
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If you are hurt on the road, unable to communicate and need emergency care you do NOT want the EMTs or healthcare folks wondering who you are, who to call, and whether you are allergic to medication… Having your health insurance info available makes getting proper treatment much easier as well.
In addition to the BikeLawyer’s Baggie you can think about adding a ROAD ID or similar item. A ROAD ID is a silicone bracelet with a tag containing … well… whatever you want… contact info, medical data, etc.
HOMEOWNER’s Insurance – Say WHAT?
Why in the world would you need your homeowner’s policy information while riding your bicycle?
YOU HIT A PEDESTRIAN
Let’s say you plan to ride from Ohio to Wisconsin. While touring through Madison you are distracted by the foliage and the incredible bike facilities and you run into a pedestrian who has the right of way in a crosswalk. The pedestrian is injured severely, and screams “I’m Gonna SUE YOU” as he is loaded into the ambulance. The police report shows you to be completely at fault… what do you do? Who pays this claim? Well… YOU do, unless you’ve got insurance.
Surprisingly, your HOMEOWNER’s or RENTER’S insurance can provide liability coverage to pay the claim! A claim against you due to your careless bicycle riding is generally covered under your H/O policy the same way a slip and fall or other premises liability claim would be covered.
CAR or MOTORCYCLE vs. BIKE CRASH – DISPUTED FAULT
I have a very active case pending right now in which a motorcyclist ran into a bicyclist. Both suffered severe injuries. However, the motorcyclist blames a cyclist & the cyclist blames the motorcyclist. What happens here?
The motorcyclist retained a lawyer & decided to sue the cyclist. The cyclist is covered by policy of Homeowner’s insurance. We notified the insurer providing Homeowner’s coverage. The H/O insurer then appointed a lawyer to defense my client. That lawyer’s job is to protect the client from the claims of the motorcyclist. The insurance lawyer and I are working together on the case.
I then filed a counterclaim against the motorcyclist in the lawsuit. The motorcyclist notified her motorcycle liability insurer, and that insurer retained an insurance defense lawyer to defend the motorcyclist.
So now suddenly there are 4 lawyers in this case – 2 for each side!
In addition, in a complex case like this one side or the other may bring other parties into the case – such as the health insurance carrier, or maybe a municipal entity if they feel there was some road defect or other flaw that could lead to liability for a municipality. In a recent fatal crash at a 4 way intersection we looked into suing the city for failing to maintain the intersection as the motorist who ran the stop sign claimed that the stop sign was obscured by vegetation growing from property owned by the municipality… In other cases, we might feel that a pothole or other road defect contributed to causing the crash.
[In fact, I wrote about the million dollar pothole here]
These cases can get very complicated. But for purposes of “THE BLS” the point here is that YOU need to take steps to protect YOU… that means buying Homeowner’s or Renter’s Insurance that would cover YOU if you are blamed for causing a crash.
If you are going on an extended trip, take your H/O agent’s phone number and your policy number. If someone claims YOU did something wrong, causing them loss, damage or injury, you will need to notify the insurer right away!
BIKE SMASHED BY A STUPID MOTORIST – Your Policy or Theirs?
Most folks think that if they get whacked by an errant motorist then the motorist’s auto policy will pay for their bike… and that’s true… sort of…
In Ohio and most states the “property damage” rules require the negligent party to pay for the property damage incurred by the victim. But what do they have to pay? Typically, the motorist DOES NOT HAVE TO BUY YOU A NEW BIKE… no… The Law typically requires them to pay you the “reasonable value” of the smashed up thing.
Bicycles are funny…they are often hard to “value” – to put a “what was it worth” number on it. People buy them… and tweak them… the upgrade the wheels or the grupo or select components… they start with Bike A and end up with Bike B, a completely different, upgraded version of the bike they bought.
If you have a “Nice Bike” like most of my clients then you are in the top 1% or so of bike owners… Most insurance adjustors may get an occasional “bike crash” case and have no clue how to “value” a smashed up bicycle. They tend to over-depreciate them and lowball the property damage offer. In fact, I have gotten MANY calls and new cases from cyclists who felt the insurer was trying to screw them over on the value fo the bike… if they’ll lowball you on the bike, what are they going to do when it comes time to value your BODY and your injuries???
If you have Homeowners Insurance, your smashed up bike may well be covered under your H/O policy. It’s likely subject to a deductible, but, you can also buy a rider that eliminates the deductible for high ticket items like bicycles, cameras, musical instruments [which happen to be MY three favorite expensive hobbies].
So if you are hit by a goofy motorist and your bike is smashed what do you do? You can certainly get an offer from the motorist. IF you have H/O coverage you should get a quote from your H/O carrier about what they’ll give you for the smashed up bike. You MIGHT get a much better offer from the H/O carrier? Why? Because the H/O carrier may be required to pay “replacement cost” for the bike – while the person who hit you with their car may have to pay the “value” of your bike. Maybe in theory those numbers ought to be the same/close, but I’ve found in practice that we tend to get a better deal from the H/O insurer.
People often say “But if my H/O carrier pays won’t my rates go up?” And the answer there is NO they should not go up. Your H/O insurer will pursue the auto carrier of the idiot who ran into you. They will get reimbursed for what they paid.
SO bottom line- talk to your insurance agent about H/O coverage. Make sure your LIABILITY LIMITS are sufficient [i.e., the maximum the insurer will pay if YOU are negligent] and ask about coverage for your “Nice Bike” that fits your needs and your budget.
Why would your AUTO insurance help you if you crash on your BICYCLE?
The typical Auto Insurance policy has two coverages that can become financial lifesavers for the cyclist: “MedPay” and “UM/UIM.” Let’s look at “MedPay” first.
What the heck is “MedPay” anyway?
MedPay – or “Medical Payments” – coverage is like a mini-health insurance policy that is written into your auto policy. If you are in a “car crash” then MedPay can be used to pay YOUR medical bills.
Take you time… it’s not like we’ve got anything ELSE to do…
Have it? Good? What are the limits?
Don’t have it?
Call your agent NOW and get it… go ahead CALL THE AGENT & GET SOME MEDPAY!
Like I said above, MedPay is like a mini-health insurance policy built into your auto policy. If you are in a Car Crash you can use your MedPay coverage to pay bills your health insurance doesn’t cover. So GET SOME MED PAY NOW!
In today’s health insurance world most folks have fairly high deductibles on their health insurance policies. $5,000 of MedPay coverage can be used to pay your out-of-pocket medical bills and help cover your deductible or co-pay.
If you do not have health insurance you can use your MedPay to cover your medical expenses, or possibly get some treatment from a doctor who requires a payment up front.
The typical MedPay coverage limits are relatively low. $1,000… $5,000 maybe $10,000. I’ve had one case in 35+ years of practice where a VERY smart older [80 yr old] cyclist paid for $100,000.00 of MedPay coverage! That cyclist ended up getting whacked by a car and fracturing his hip, requiring two separate surgeries and a hip replacement! We were able to tap into his MedPay to cover his initial surgery to fix the hip and the subsequent hip replacement he required when the initial surgery didn’t fix the problem… he used his ENTIRE $100,000 of MedPay and ended up having to pay very little “out of pocket” despite his extensive treatment & therapy!
These insurance issues can get complicated in a hurry. If you are whacked by a car while riding your bike you should ALWAYS think about calling a lawyer for help.
MED PAY & BICYCLES ON THE ROAD – AVOID “NATIONWIDE” AT ALL COSTS
Does MedPay even apply when you are on your bike?
I’ve read the insurance policies of MANY auto carriers. The answer, to me, is always YES>>> … IF… you are involved in a car crash. –> UNLESS… you have Nationwide.
Natiowide is the only company I’ve encountered which will NOT pay Medical Payments benefits to cyclists who are hit by cars.
They will refuse to pay and argue that they only pay for “pedestrians” who are hit, not cyclists. They will NOT pay the benefits you paid for if you are hit by a car while on your bicycle… they will fight you… they will litigate this with you…
I’ve done battle in courts with them over the years on this topic. I’ve won some and they’ve won one.
The bottom line is really this … don’t give Nationwide your business…
–>DO NOT BUY NATIONWIDE AUTO INSURANCE IF YOU RIDE YOUR BIKE ON THE ROAD!
OK, that’s the end of my Nationwide rant.
Here’s my NEXT MedPay rant.
DO NOT GIVE YOUR MED PAY INFORMATION TO ANY MEDICAL CARE PROVIDER
If you are in a Car/Bike crash and taken to the E/R give the E/R your health insurance information. They may ask you to tell them about your AUTO coverage – either while you’re lying there on the gurney or in a form they send you later, after you’re home.
Let me say it again –> IF YOU ARE IN A CAR/BIKE CRASH DO NOT GIVE YOUR AUTOMOBILE INSURANCE COVERAGE TO ANY CARE PROVIDER
Why does the E/R, your doctor, your chiropractor want your AUTO insurance coverage?
One Word – MEDPAY
[ok, technically maybe “MedPay” isn’t even a word… but you get my drift…]
The E/R wants your MEDPAY coverage. The doctor wants your MEDPAY coverage. The Chiropractor wants your MEDPAY coverage.
Like any business, your care providers want to get paid- and they want to get the most money they can get for treating you.
They will bill you $X.00 for the services they provide … but … they rarely GET the full $X.00 from anyone. The medical industry’s billing/getting paid process is just screwy…
If you have health insurance they are stuck because if they submit the claim to your health insurer they have to accept the lower negotiated rate for the services they provide.
For example, your E/R bill might be $5,000.00. However, your health insurance has negotiated a lower rate that it will pay for the services…maybe $2,500.00 instead of $5,000.00. The hospital has to “write off” the rest.
The E/R can provide exactly the same service to five different people – and send out five bills for exactly the same amount – and collect get five wildly different amounts based on five different insurance situations. Anthem pays a different rate than Blue Cross Blue Shield which is different than United Health Care, etc. They negotiate their own deals. Medicare probably pays the least.
But… if the hospital finds out you have MEDPAY in your Auto policy, the hospital can…without your knowledge or “consent”… submit a claim to your AUTO policy… they’ll submit that same $5,000 bill and then they will simply take your $5,000.00 of MedPay coverage…
I’ve seen this happen repeatedly behind the client’s back and without the client’s “knowing” consent. In fact, this issue was litigated up to the Ohio Supreme Court…and our Ohio Supreme Court let them do it.
I say this frequently happens without your “knowing” consent because buried in all those forms you sign when they put you in the hospital are forms in which you give the hospital permission to submit claims on your behalf to ANY insurer[s]. Typically that means health insurance but if the hospital thinks it can get more money by billing your AUTO insurer you can be sure that they’ll do it. There is an Ohio Supreme Court case that lets them do this.
One of my first letters in a new case is to the client’s MedPay carrier advising them to NOT PAY ANYONE out of the MedPay until the Client specifically agrees, in writing. Your MedPay is special insurance for YOU – which YOU can control, if you know how to do it…
OK, SO much info on MedPay… who knew, eh?
UM/UIM – UNINSURED/UNDERINSURED MOTORIST COVERAGE
The “uninsured” [UM] part of this is obvious. If you are struck by motorist who simply has no insurance, your UM coverage should pay your injury claim just as if it was the motorist’s coverage even though you are on your bike.
The “underinsured” [UIM] may not be so obvious. If the motorist who hit you has “some” coverage, but not enough to pay the full value of your claim, your policy’s “UIM” coverage may be used to pay more towards your claim depending on your policy limits.
I advise my cycling clients to buy as much “UM/UIM” coverage as they can afford. It protects YOU in the event you are injured by an errant motorist.
Be wary of arguments similar to those raised by Nationwide – i.e., that cyclists are not covered by auto insurance. I have not encountered this argument here in Ohio – particularly since 2004 when an Ohio appellate court ruled that cyclists were covered. In today’s “Let’s Not Pay Claims” word in which insurance companies live, I would not be surprised to see it raised again…
ARE YOU CARRYING AN UMBRELLA?
Do you carry any type of excess or umbrella insurance? These types of policies are designed to fit over the top of all other policies and only come into play when all other available insurance is used up and you still have losses. An umbrella policy is usually written with large policy limits – often $1,000,000 or more. The carrier writing the umbrella usually requires significant underlying coverage – usually $250,000.00 or more.
Play the “What If” game for a minute – What If you are killed by an uninsured, or underinsured motorist. What would happen to your family, financially. What if you are rendered incompetent – or unconscious. Are you a small business owner? What would happen to your dental practice – or your bakery –if you are taken out on a bike ride? How much money would your family need to be covered sufficiently.
I advise ALL bike riding clients to consider an umbrella policy. These are typically very inexpensive policies [a few hundred bucks per year] and, in that once-in-a-lifetime situation, can save your financial life! The more you have to LOSE the more you NEED a high level of insurance protection!
Not all Umbrellas are True Umbrellas- you need to understand what RISK you are covering.
If the Risk you want covered is the Risk that YOU might need UM/UIM coverage that exceeds the basic auto policy limits then you need to convey that to your agent and MAKE SURE you get an umbrella that covers that risk.
In Ohio, the Umbrella MIGHT apply to your auto policy. You have to MAKE SURE that it does by confirming with your agent. You then have to LOOK AT the DECLARATIONS PAGE and confirm that it applies.
Even then, that’s not the end. You have to MAKE SURE THAT THE UMBRELLA COVERS UM/UIM CLAIMS.
Insurers today are selling Umbrella policies that cover auto Liability claims [i.e., you run over somebody and are liable] but EXCLUDING UM/UIM claims… you might have to pay a small additional premium to add the $1.0 million umbrella coverage to your UM/UIM auto policy.
It sure is… But… DO IT… Assuming you’ve reached this point of the BLS I’lm going to make the assumption that you are a cyclist with an interest in Umbrella policies… if you already have one, CHECK RIGHT NOW to make sure it covers UM/UIM claims… if you’re not sure ASK YOUR AGENT IN WRITING… in an EMAIL… and GET IT DONE.
I have a case right now… a fellow changed insurance in May 2020… he HAD an Umbrella that covered his UM/UIM… he wanted a new policy that duplicated his old one… The company did not give him that…rather they gave him a policy that only covered auto liability… the poor fellow got hit by a careless motorist and has what might be a million dollar claim… the motorist has … you guessed it … state minimum coverage… $25,000… his Umbrella carrier has told him that it does NOT cover the UM… so we might need to tee up 2 or 3 years worth of litigation…
Check Your Umbrella… or GET ONE if you think you might need one!
DISABILITY INSURANCE – Covering the REAL Risk
Everyone knows about life insurance. However, the overall risk that you will be disabled is actually considerably higher than the risk of being killed. This risk evens out as you age. In one report I read, the likelihood of becoming disabled 4 times greater than being killed at age 30, 2.7 times greater at age 40. By age 55, becoming disabled was still 1.5 times more likely than dying. While deaths from cancer, heart disease and stroke have actually gone down, the risk of becoming DISABLED from one of these “Big Three” has climbed. So folks are surviving stuff that used to kill them – but are still becoming disabled.
On a bicycle, you are far more likely to be injured, and possibly disabled, than killed. In Ohio each year there are 1600-2000 bike crashes. Cyclists are injured in 70+% or so of those crashes. However, they are killed in less than 1% of the crashes.
The bottom line – Disabilty Insurance is another product which every serious road cyclist should consider. As with life insurance, the more you stand to lose the more important this coverage is!
Real Life Insurance Example
Some years ago I had a case in which I represented a physician who rode all the time. Unfortunately, he suffered a dangerous neck fracture in a crash caused by a careless motorist. The motorist carried Ohio’s paltry state minimum auto coverage – back then it was only $12,500.00.
Thankfully the doctor eventually recovered. However, it took many months and he was off work or working on a very limited basis during that time. His medical bills were in excess of $100,000.00 and his wage loss was over $40,000.00.
Fortunately, the cyclist had $300,000.00 “Underinsured motorist” coverage and $10,000.00 in “medical payments” coverage. We used the medical payments coverage to cover the “co-pays” and other out of pocket expenses the client incurred for his neck surgery and other treatment.
The doctor also maintained an excellent disability insurance policy that kept him afloat financially while he was off work. Finally, he had an umbrella policy with $1.0 million limits. Back then an Umbrella in Ohio that covered an Auto policy was MANDATED by law to cover UM/UIM claims. That law has since changed [hence my WARNING above for your to Check Your Umbrella].
Since the value of his claim exceeded the $300,000.00 “UM/UIM” limits, his “umbrella” was available to pay the balance. From an insurance perspective, he was well-prepared for the “once-in-a-lifetime event” that came out of the blue while he was riding his bike on a sunny summer afternoon!
So yes, the BLS may well be BORRRRRRRRRRRING… but it can become critically important if you get whacked… Think about the BLS NOW, and ride with a sense of freedom and security that comes from being prepared!