Payout procedure for stolen bike

[Slono]

Hey all, out of curiosity how do the insurance companies decide what the payout is for a stolen motorcycle, does the insurance company give you the equivalent to what you declared when you transferred the ownership or do they go by current market value? Is each company different?

 

[Sushii]

Hey all, out of curiosity how do the insurance companies decide what the payout is for a stolen motorcycle, does the insurance company give you the equivalent to what you declared when you transferred the ownership or do they go by current market value? Is each company different?

Market value. They look at similar bikes and give you a price based on those similar bikes.

 

[Slono]

Market value. They look at similar bikes and give you a price based on those similar bikes.

I'm confused because that's what I thought at first, and then my friend's bike was stolen and they only gave him what he declared.

 

[Sushii]

I'm confused because that's what I thought at first, and then my friend's bike was stolen and they only gave him what he declared.

What bike was it? Maybe it was an old bike that they couldn't find a similar one to. Or maybe the adjuster was too lazy to do research and just gave him what he declared.

 

[jeffjones]

I'm confused because that's what I thought at first, and then my friend's bike was stolen and they only gave him what he declared.

Maybe he paid what it was worth......
If they paid him to little why did he accept it.

 

[Slono]

I'm not sure if he realized he could turn it down. It was an 2008 CBR600rr graffiti edition, and they offered him exactly what he declared. I'm positive its worth more than $6,000.

 

[daisoman]

After his deductible that sounds fair to me. I got my mint 2007 cbr for $6200.

I dont think they'll use what was declared because with if that was 5 years ago. Will they still pay what he declared?

 

[Sushii]

After his deductible that sounds fair to me. I got my mint 2007 cbr for $6200.

I dont think they'll use what was declared because with if that was 5 years ago. Will they still pay what he declared?

Maybe it was under declared, so it was less than the market price.

 

[BubbaL00]

You are to receive replacement value minus deductible which you can negotiate.

 

[RickT]

Typically they contact a number of motorcycle dealers to ask what the retail value of the bike would be. Sounds like in your friends case since he declared the bike worth only $6K, that is what they paid him (assuming of course the quote received were for a higher amont). A quick check at autotrader.ca would show people are trying to sell similar bikes for $,7,500 or more.

I'm not an expert at insurance policies but I'm guessing the paperwork might say something to the effect of "retail value of bike as determined by XXX Insurance company or declared value, whichever is less". I guess it all goes back to why your friend declared $6K if the bike is worth more? Was he/she hoping to save money by riding a less expensive bike?

Not sure what recourse they have. Good idea to read the policy fully and perhaps contact a lawyer. Even better, I believe they can ask the insurance company for justification on the value. My guess is they could in turn ask for proof of what they paid, and if they paid more could try to weasel out of paying for misrepresentation.

Good luck.