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.
It’s been a while now, so I thought I’d re-visit the BLS and make sure folks out there really Got It!
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? What if you die?
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.
THE BLS – PART ONE – INSURANCE PLANNING
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.
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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?
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.
In one recent case I handled, my cyclist/client was hit by a guy on a motorcycle. The motorcyclist was passing my client, over a double yellow, on a blind curve at a point on the curve where a bike trail intersects. My client was moving towards the bike trail when he was struck by the motorcyclist. As we were preparing to present the injury claim to the motorcyclist’s insurer I received word the motorcyclist had sued my client!
I then notified the client’s homeowner’s insurer, who assigned a lawyer to defend that claim. The insurance lawyer and I worked together on the case. I filed a counterclaim against the motorcyclist in the lawsuit. The motorcyclist notified HIS motorcycle liability insurer, and that insurer retained an insurance defense lawyer to defend him. So now there were 4 lawyers in this case! We settled my client’s case and the H/O insurance lawyer defended the cyclist from the goofy claims of the cmotorcyle driver.
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!
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.
I want you to make sure your Auto Policy has “MEDICAL PAYMENTS” [AKDK MedPay] coverage… Go ahead… pull out your policy right now and check… we’ll wait for you…
Have it? Good? What are the limits?
Don’t have it? WHY NOT? Call your agent NOW and get it… go ahead CALL THE AGENT & GET SOME MEDPAY!
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. In today’s health insurance world most folks have fairly high deductibles. $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 cyclist paid for $100,000.00 of MedPay coverage. That cyclist ended up getting whacked by a car and fracturing his hip. We tapped 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!
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.
Does MedPay even apply when you are on your bike? 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. I’ve done battle in courts with them over the years on this topic. I’ve won some and they’ve won one.
So- bottom line…
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.
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.
–> DO NOT GIVE IT TO THEM.
Well, the E/R wants to get the most money it can for treating you. If you have health insurance they are stuck because if they submit the claim to your health insurer they have to accept the 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.
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 the $5,000 bill and 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.
I say “knowing” because all those forms you sign when they put you in the hospital typical include forms in which you give the hospital permission to submit claims on your behalf to your 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.
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!
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
My client, a physician who rides all the time, suffered a dangerous neck fracture in a crash caused by a motorist. The motorist carried Ohio’s paltry state minimum auto coverage – then $12,500.00. The client’s medical bills were in excess of $80,000.00and 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” 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. 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!
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!