As with crashes involving your own personal bicycle, one of the issues that arises on a rental or bike share bicycle is what insurance policies cover you if you are injured in a crash. There are a lot of similarities here between crashes while riding your own personal bicycle, and crashes while riding a rental or bike share bicycle, but there are also some notable differences that you should be aware of.
The Driver’s Insurance
In a car-on-bike crash in which the driver is found to be negligent, the driver’s insurance company will be responsible for compensating you for your injuries and losses caused by the driver. This is the case whether you are riding your own personal bicycle or riding a rental or bike share bicycle.
Your Insurance: UM/UIM
However, one problem that bicyclists can encounter in a car-on-bike crash is a driver who is “underinsured.” This means that the driver is insured as required by law, but for less than the amount of damages that have resulted from your injuries and losses. The reason we have underinsured drivers on the road is because the minimum insurance amounts required by states are often very low.
For example, in California, the minimum insurance required is $15,000 per crash for bodily injury or death. This is an extremely low minimum insurance requirement and can easily be exceeded in a car-on-bike crash involving injuries to the cyclist. Even in Oregon, where the minimum insurance required is $50,000 per crash for bodily injury, the minimum can quickly be exhausted if a cyclist sustains serious injuries in a crash.
In cases involving an underinsured driver, your UM/UIM (“Uninsured Motorist/Underinsured Motorist”) coverage on your own auto insurance policy (and now available in comprehensive bicycle insurance policies) can step in once the driver’s insurance policy is exhausted. You would also use your own UM/UIM coverage if you are hit by an uninsured driver, or if you are the victim of a hit-and-run driver. For these reasons, cyclists who do have an insured automobile should purchase the maximum amount of UM/UIM coverage available.
A word of warning, however—DO NOT accept a settlement from an underinsured driver’s insurance company without first getting approval from your own insurance company. If you do accept a settlement without the approval of your insurance company, your insurance company may decline to pay on your UM/UIM claim.
The reason is that when you file a UM/UIM claim, you are authorizing your insurance company to “stand in your shoes” in pursuing a claim against the underinsured driver. If you accept a settlement offer from the underinsured driver’s insurance company, you are preventing your insurance company from pursuing their legal right to file a claim against the underinsured driver, and as a result, if you do not have permission to settle, your insurance company may legally refuse to pay your UM/UIM claim.
Your Insurance: Personal Injury Protection or “Med-Pay”
In Oregon (and 36 other states), your automobile insurance policy is required to provide coverage for “Personal Injury Protection” (“PIP”), also known as “Med-Pay.” If you are injured in a car-on-bike collision, your own PIP coverage on your auto policy will pay on your injuries during the first year after the collision, up to the amount of PIP coverage on your policy. Because Oregon is a “hybrid” state that has some features of “no fault” states, and some features of tort liability states, if your PIP coverage is exhausted by your injuries (which is easy to happen with a $15,000 minimum policy coverage), you can file a claim against the negligent driver’s insurance policy. Filing a claim will mean negotiating with the insurance company about who was at fault, and ultimately, may mean filing a lawsuit against the negligent driver if you cannot reach a settlement agreement with the driver’s insurance company.
In California (and 12 other states), “PIP” coverage is available as an option on your automobile insurance policy, but is not required.
There are several benefits to having PIP coverage on your auto policy:
- Most PIP coverage will cover the cost of your medical treatment (this is the “Med-Pay” portion of your PIP coverage), your lost wages, and in a fatal collision, funeral expenses.
- PIP will cover you regardless of who is at fault in the collision.
- PIP will pay your medical bills much faster than they will get paid by the driver’s insurance policy.
- PIP will pay regardless of whether you win or lose your claim against the driver’s insurance company.
- PIP will pay when you have been injured by underinsured, uninsured, and hit-and-run drivers.
The disadvantages of PIP coverage are:
- PIP coverage is more expensive than other types of coverage on your policy, so people tend to select as little coverage as possible.
- In states where PIP is required, the minimum required coverage can be quite low (for example, $15,000 in Oregon), and that low minimum means your PIP coverage can be exhausted within the first few minutes of a serious crash.
- PIP coverage is likely to be many times less than the damages available in a claim against the driver’s insurance company, because damages for your pain and suffering are not covered by PIP. For example, if you are seriously injured and will live in pain for the rest of your life, your PIP coverage will not compensate you for that.
Your Insurance: Health Insurance
If you have health insurance, your policy will cover your medical costs for injuries sustained in a crash, even if the driver has insurance. This will relieve you of your immediate worries about your medical bills as you wait for your claim against the driver to be settled. However, be aware that if your medical costs have been covered by your health insurance, and you later recover damages for medical costs against the driver who injured you, you will be required to reimburse your health insurance carrier for medical costs it has paid. Therefore, you must take care when negotiating a settlement to be compensated for ALL of your medical bills.
Your Insurance: Homeowner’s or Renter’s Insurance
If you have homeowner’s or renter’s insurance, you have coverage for your negligent acts that cause personal injury or damage to property.
The Bicycle Company’s Insurance
But what if there’s a crash, and it isn’t caused by you, or by a driver? What if it’s caused by a defective product—the bicycle itself? A defective bicycle, or a poorly maintained, unmaintained, or previously damaged bicycle may be the cause of a crash. In that case, the bicycle manufacturer, or the rental company or bike share company, or both may be liable for your injuries.