By Bob Mionske
In 1898, Dr. Truman J. Martin of Buffalo, New York paid $11.25 for an insurance policy that provided him with up to $10,000 of liability coverage (about $250,000 in inflation-adjusted dollars, according to the Consumer Price Index). This was the first automobile insurance policy ever written. By then, insurance policies had already been available to cyclists. Within a quarter century, liability insurance for automobiles had become both common and necessary enough that the Massachusetts legislature made it mandatory for drivers to carry insurance. Bicycle insurance, on the other hand, had become a forgotten relic.
That’s unfortunate—if anybody is in need of insurance against the negligence of motorists, it is cyclists, who share road space with multi-ton vehicles traveling at up to four (or more) times the cyclist’s speed, and without the protection that a multi-ton cage of steel offers to motorists. Of course, motorists are almost always required to be insured, so at least theoretically, cyclists are covered against the negligence of motorists. And theoretically, cyclists also have access to insurance, albeit not comprehensive policies, like the ones available to motorists.
In reality, however, cyclists are not only exposed physically on the road (a point the World Naked Bike Ride brings home to the streets every summer), they are also exposed financially. There are four factors that contribute to the financial risk to which cyclists are exposed, quantified here.((
Underinsured Drivers(
Every state requires motorists to be insured (or alternately, provide proof of financial responsibility),but the minimum liability coverage is often shockingly low. For example, in Ohio, motorists are in compliance with the law as long as they have $12,500 of liability coverage. This low minimum requirement means that many motorists are underinsured for all but the most trivial of accidents. If you are injured by a negligent driver, and your injuries exceed the amount of insurance the motorist carries, then you will be responsible for paying for your injuries for any amount beyond what the motorist is insured for. You may then attempt to sue the negligent driver, but many underinsured drivers are “judgment proof”—meaning the driver won’t have the assets to pay for your injuries even if found negligent at trial. Thus, an underinsured driver is passing the burden of paying for his or her negligence onto the victim, all while meeting the letter of the law regarding financial responsibility.
Uninsured Drivers(
Although every state requires motorists to be financially responsible, many motorists do not have insurance, and yet continue to drive. Typically, these uninsured drivers are motorists who cannot afford insurance and recent evidence indicates that the recession is resulting in more uninsured drivers on the roads. To add to the danger, uninsured drivers are statistically more likely to be involved in crashes to begin with, and are more likely to be repeat offenders.
Lack of Available Insurance(
Cyclists face some distinct disadvantages when confronted with an underinsured or uninsured driver. First, cyclists cannot buy insurance to protect themselves against uninsured and underinsured (“UM/UIM”) motorists. Unless, that is, they own a car. Now, many cyclists do own cars, and their auto insurance policies protect them against uninsured and underinsured drivers (but check what your auto policy covers for UM/UIM claims—some, but not all, carriers are paying claims for personal injury, but denying claims for property damage). For those cyclists who have auto policies, I routinely advise that they buy the maximum amount of UM/UIM coverage available. However, increasingly, many cyclists do not own cars, and therefore, UM/UIM coverage is not available to them. For these reasons cyclists are the most vulnerable vehicle operators on the road—unable to buy insurance to protect themselves and exposed both physically and financially to the most dangerous drivers on the road. This is a patently unfair situation—is there any rational reason that one cyclist has access to UM/UIM coverage, simply because the cyclist owns a car, while another cyclist does not have access to that insurance? Of course not—the requirement to own a car is entirely arbitrary. Nevertheless, unless you own a car, your only other recourse is to have a good health insurance policy.
Further, an increasingly common problem is coverage in the case of bike-on-bike crashes, especially as more cyclists give up cars as a mode of transport and instead rely on bikes for commuting. Current insurance coverage is inadequate for meeting cyclists’ needs, because no auto insurance policy covers these collisions, and these collisions will become more common as cycling grows in popularity. Bike-on-bike collisions are a real problem, and I’ll cover this issue separately in an upcoming article.
Legal Presumptions of Liability(
Let’s take a look at what happens when a driver injures a cyclist in the Netherlands, and then let’s compare that to what happens when a driver injures a cyclist in the United States.
In the Netherlands, the law imposes a rebuttable presumption of liability on drivers—if a motorist is involved in a crash with a cyclist, the law presumes that the motorist is liable for the crash, unless the motorist can rebut that presumption with evidence to the contrary. The reason for this shift is that the Dutch recognized that the cyclist will virtually always be the injured party in a collision with an automobile, and by putting the onus of fault on the driver, have provided motorists with a powerful legal incentive to pay more attention to the presence of cyclists. Thus, it wouldn’t be legally sufficient for a Dutch driver to merely claim “I didn’t see him”—the most common excuse drivers use in the United States—in order to escape liability. Instead, the Dutch driver would have to prove that the cyclist’s own negligence was the cause of the collision. And even if the Dutch driver can successfully rebut the presumption of liability, the driver’s insurance is still required to pay the cyclist’s medical bills.
By contrast, in the United States the legal disadvantage cyclists face begins the moment police arrive, since they are allowed to make an initial determination about fault. If the police blame the cyclist, he has an even more difficult burden of proof, because the motorist will use the police determination as a defense in court.
And unfortunately the police often determine that the cyclist is at fault even when there is no evidence to support that conclusion, or, in many cases, even in the face of clear evidence that the driver is at fault. (See this article.) In this piece, I discuss several cases where police bias affected the investigation of traffic collisions. In one example a 17-year-old driver made a left turn into the path of a cyclist, killing him instantly. The police rushed to blame the cyclist for riding “too fast.” In another case, a cyclist was hit by a driver who had gone into diabetic coma, and the police blamed the cyclist for riding against traffic, and running a red light, even though nobody witnessed the cyclist doing either.
I have seen this type of police bias many, many times in my practice, and I have received countless communications from cyclists alleging that the police rushed to judgment, often without even bothering to interview the injured cyclist before deciding who was at fault.
Beyond even the cases cited above, police data reveals a hidden bias—80 percent of all car-on-bike crashes are the fault of the cyclist, if one can believe the police reports. And yet other data do not back up the conclusions of police investigators, and in fact, indicate that cyclists are at fault in fewer than 50 percent of these collisions.
In the United States, the injured cyclist must also deal with the insurance company of the driver (assuming, of course, that the driver is insured). Often, immediately following a collision, the driver will admit to liability at the scene, only to think better of it later, and deny any liability at all. I have also seen this happen many times in my practice. The result is that the driver is telling the insurance company that the collision was the cyclist’s fault, and the insurance company will often eagerly adopt the driver’s position. Even if the driver isn’t telling the insurance company that the collision was the cyclist’s fault, the insurance company will often still try to shift some of the blame for the collision onto the cyclist to avoid a costly payout. In the handful of states that still have a system of “contributory negligence,” if a jury finds that the cyclist was at fault in any amount—even 1 percent—the cyclist will be completely barred from recovering for his or her injuries. Even in states that have adopted a system of “comparative negligence,” the injured cyclist’s damages will be reduced by the amount of the cyclist’s own negligence, and in most of these states, if the cyclist is more than 50 percent at fault, the cyclist recovers nothing.
To reiterate, in the United States, the injured cyclist has the burden of proof every step of the way.
Insurance for Cyclists?(
The above for factors work together to raise the cyclist’s exposure to financial risk. The car-free cyclist’s ability to reduce that exposure has been far below what is available to the average motorist. However, some insurance companies have begun offering insurance policies to cyclists. For example, in the United Kingdom, companies such as ETA offer comprehensive insurance to cyclists. These policies typically offer the cyclist high levels of protection for the cyclist’s own liability, as well as coverage against theft; they also offer the cyclist medical coverage in much smaller amounts than the liability coverage in the policy. These insurance structures reflect two realities. First, every cyclist (and every non-cyclist, for that matter) in the U.K. is already covered by the National Health Service, so medical coverage in a cycling policy is probably supplemental to the cyclist’s primary coverage. Second, the differences between coverage for the cyclist’s liability and medical probably reflect data that cyclists cause relatively few and minor injuries, proportionate to the injuries they receive.
As reported in a Korea Times article discussed in Cycloculture, evidence supporting this analysis is indicated by previous experience in the Republic of Korea. In 1997, Samsung Fire and Marine Insurance began providing insurance to cyclists; eventually, the program was suspended “due to growing insurance money payouts.” Nevertheless, with an explosion of new bicycle commuters flooding South Korean streets, insurance for cyclists is expected to be available beginning later this year, following a commissioned assessment of the risk ratio.
It appears that things may be changing in the United States as well. Clipp, Inc. now offers insurance to member cyclists who have completed a safety training course with a League Cycling Instructor. The insurance offers coverage against theft, and coverage with low limits for property damage, medical, and accidental death and dismemberment. The insurance is only available in Texas at present, but Clipp plans to expand availability to other states in the future. Other insurance companies may be offering insurance to cyclists in the not-too-distant future as well. I am personally aware of two proposals for evaluating the feasibility of offering full comprehensive coverage to cyclists; there may be additional companies out there proposing similar analyses.
In the 1890s, the insurance companies sensed a business opportunity in the rising tide of cyclists, and began offering insurance coverage. Today, with cycling on the rise once again, innovative companies are beginning to sense a business opportunity in an unmet need; it may only be a matter of time before we see the first comprehensive bicycle insurance policy.
(Research and drafting provided by Rick Bernardi, J.D.)
This article, Why We Need Cycling Insurance, originally published on Bicycling on June 22, 2009.
