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Thursday, March 27, 2008

Cargo Cycle Insurance: Are You Covered?

It's estimated that over half a million bikes are stolen in the UK every year, two thousand are stolen annually in Oxford alone.
Figures on show that in 2005, 3201 people were killed on British roads and 5% of these (160 people) were cyclists. The previous year the total was 136.
It's been difficult putting this post together as several of the larger insurance companies just haven't bothered to reply to my enquiries.
So insurance is a must and I discovered that the policies offered by E&L insurance, JLT online and Butterworth Insurances (who provide the CTC's Cyclecover) all make exclusions in some part of the policy (theft or accident or public liability) for bikes used in trade. JLT specifically mentioned courier work and carrying passengers for reward. E&L mentioned trade bikes being excluded from the public liability sections of the policy. The Butterworth cycle cover excludes the theft or loss of bikes used for "trade, business or professional purposes". The excess on this policy is also increased from £25 to £50 on trikes, tandems & recumbant bikes for "social domestic & pleasure".
All this has led me to consider just how to insure your bike and trailer, trike, or quad when it's used in business. "Business on wheels" whom I mentioned in my previous post say that a number of their customers have used Southwater Insurance Ltd on 01403 785995.
I spoke to a very helpful Andy Macauley at Southwater who kindly talked me through the insurance issues relevant to the sort of business he does with operators of ice cream vending trikes such as the one pictured.
We started from a point where I'm a sole trader and I've just bought myself an ice cream trike for £4500.
Firstly I need to insure against theft and accident and this would cost around £350 a year. There are a couple of caveats to this. The trike must be garaged at night and attended at all times during the day.
Secondly I need liability insurances for injuring a member of the public either because of the trike or my products. This would cost an additional £120 per year approximately and provides £2Million cover.
The above are two separate policies. Other insurances to consider, If I had two trikes and therefore an employee I would have to take out employers liability insurance. This is a legal requirement and protects me from the cost of injury to my employee at work (say injury from collision with a car). This would cost me about £300 per year for my one employee.
If I want to protect myself from the costs of an accident then I need personal accident insurance, again a separate policy.

There's a lot to business insurance, for instance I haven't touched on goods in transit insurance, and I strongly suggest you speak to a broker in case any of my facts are wrong. I'd greatly appreciate any informed comment on issues of insurance for bikes & trikes at work.
Again my grateful thanks to Andy at Southwater Insurance Ltd for his invaluable advice.

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