Getting ATV insurance is the smart choice.

ATV insurance is far from the most interesting subject matter, but if you own an ATV or any other off-road vehicle you’d be wise to educate yourself. This article is a good place to start on your road to ATV insurance knowledge and we’ll do our best to make this as painless as possible.

Here’s the simplest explanation you have ever heard about what liability insurance is: Liability insurance covers everyone but YOU! Ok, almost everybody. If for some reason you have a passenger and that passenger happens to be married to you or are full-time residents of the insured (your) household there may be provisions that exclude them. You MUST ask your ATV insurance agent, insurance broker or online underwriter what the passenger liability exclusions are. It’s that important.

Know Your Minimum Liability

All insurance is a controlled affair. Each state has an Insurance Commissioner and they approve insurance laws, rate increases and decreases and they set the state minimum liability limits. The MUST part rears its head again – ask your agent to confirm your state minimum.

For example, in Georgia that lowest limit is $25,000/$50,000. Those are the bodily injury pay out maximums for a single injured or multiple injured. The majority of people automatically pick the minimum limits. Why? Because insurance agents play CYA and don’t explain why it’s important to buy the highest limits you can afford. It’s all about loss ratio. Ask your agent how loss ratio affects them. Most won’t. I will.

As an insurance agent, your loss does directly affect my income. Any agent that says otherwise is lying and you should find a new agency or broker to deal with. If you cause $80,000 worth of bodily injury and property damage in a claim and I only send that company about $100k annual in written premium you have just caused me to lose money. Typically, insurance companies expect to absorb losses just at or under 70 percent of what they collect. That means they pay the bills, employees and shareholders out of the other 30 percent. That’s acceptable to many companies as the cost of business. Anything over is losing them money and an independent agent can actually be suspended from writing business until you dip below the threshold. That’s why many agents don’t want you to max out your liability. One claim can end a year of hard work. It’s not easy being an independent agent or broker. It’s also why insurance companies direct market against the agents and brokers. If they aren’t paying me my 15% for your ATV insurance than it is just bonus. And NO – insurance companies are not supposed to offer you better rates from direct business versus going to an agent. That’s called rebating in most states and is illegal in almost every state I can think of.

Is The Minimum Enough?

What I am about to say goes for ALL things you insure. Unless you’re under 25, single and not a homeowner the chances are you are under-insured if you have only the minimum. Don’t give me the “What damage can I do” line. It’s not you I care about in reality – it’s the ones you hit, your property and your family. If you are on the trail or in your car and you hit anybody you will almost always exceed that minimum bodily injury limit if surgery for the victim is involved. So, being sued for the sake of $70-$100 annually or semi-annually is your idea of good economics?

There you go. I bet you’re starting to get the picture. I suggest to all my customers to buy a minimum of $100,000/$300,000 bodily injury limits. Unless you’re a single kid with no assets other than your wheels- that’s your only excuse to buy less coverage. The difference in the motorcycle world is usually less than $70 annually for anyone married and over 35 years old. The difference for ATV insurance is usually less than $15 annually. It’s not about commissions – 15 percent of a $100 won’t buy lunch for two at sit down restaurant. It’s about protecting my customers from being put in a financially undesirable position. I hope that explains the need for higher liability limits than just the minimum. Just don’t get burned for the sake of a few bucks.

Property damage is the last number in the liability equation. It fixes the things you break. Cars, bikes, ATVs, guardrails, telephone poles, fences…the list goes on. Simply, if you break it you or your ATV insurance is going to have to pay to repair it to “like” condition. All insurance works like that. Insurance is supposed to put “whole” the victim in an accident. In Georgia the minimum property damage liability is $25,000. Not bad, but one Georgia Power telephone pole installed is $28,576 – don’t ask how I know that. If you buy what I suggest then you have doubled your money to $50k for property damage. Suddenly, you’re not getting a friendly letter explaining that they will accept payments in a timely manner.  It was a railbuggy, if you must know, and the pole I think was around when the telegraph was invented.

Un/Under Insured Motorist Coverage

In most states you have the availability of un/under insured motorist coverage. This is what fixes your body in the event you are hurt by the uninsured or under insured on the road, dirt and water. HOWEVER, in most cases people will pass on uninsured motorist coverage. Some companies don’t even offer it for off-road riders. I’m not sure why people pass. Dirt riders are not usually insured and if you are hit by one then how do you get fixed or pay for the bills? I know that most places aren’t exactly packed with people when riding dunes or in the dirt, but injuries happen and it’d be a shame to have medical bills hanging over you if your personal healthcare provider gives you static and tries not to pay for your recovery. Just sayin’……

Here is the vital part for the insured: Comprehensive coverage. Theft, fire, vandalism (unless caused by a family member) and acts of nature are covered. Family members or significant others destroying your toys in a fit of rage are not covered. Yes, it’s happened more than once at my agency. Don’t let family mess with your toys – period. ATVs, UTVs (all the rage in theft rings), and dirt bikes are easy to make disappear. Most people never title them. They buy the toy, get the MSO (manufacturer statement of origin – kind of looks like a title, but it’s not) and toss it in a drawer. Toy goes away and that’s it. Nothing will be done. To think that the police will actively pursue an off-road vehicle if stolen gives you way more confidence in them than you should rightfully have. They simply have better things to do than mess with your RZR or Raptor. It’s actually pretty cheap coverage. As a single component of the price structure of your ATV insurance you will usually pay less than $100 annually.

For off-road toys most people don’t option for collision coverage. My theory on this is that it’s plastic. If it breaks replace it. In most situations it’s actually cheaper to buy the part and re-install it than it is to try to utilize your coverage and pay a deductible. You should be more worried about theft than breaking plastic. But I will gladly sell you a comp/collision policy if you want to pay for it. That extra $3.00 in commission has got to be able to buy something I need for my bike.

It’s Cheaper Than You Think

ATVs and other dirt toys in general cost very little annually to insure. ATV insurance for most machines can often be had for under $150 annually with many insurers. That’ll buy you $100k/$300k/$50k limits and comprehensive coverage. It’s the most common coverage I sell for off-road toys. Some insurers have limits of what they cover. A great example is anything with six wheels. No one I know of likes them enough to insure them for under $250 if they insure them at all. Oh, and if you’re riding off of your land then homeowner’s coverage will not help you. Ask and see if I’m right.

That’s it, really. Hope you learned something. Your ATV, UTV, Buggie, Dirt Bike and anything you can think of that gets dirty and is powered can, in most cases, be insured. Some of you can absorb a loss if it gets taken. Most cannot. Ask your insurance agent, broker or other insurance professional what they can do. Odds are it’s cheaper than you think.



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