Five-minute guide to... bike insurance

Ditching four wheels in favour of two isn't just environmentally friendly, it's a great way to save money in these financially straitened times.

But, before you hit the cycle lanes, make sure your bike is insured - according to M&S Money, in the past two years over a quarter of cyclists have had their bikes stolen. So what do you need to know?

Q: Why do I need bike insurance?

A: Just locking your bike to a lamp post isn't enough. If you want to guarantee you won't lose out, insure your bike, particularly if you use it as your main method of transport - to travel to work, for example.

Bike insurance will not only cover you for theft, but also for accidents involving a third party and accidental damage.

Q: Won't it be covered by my home insurance?

A: Many home insurance policies do extend cover to bicycles stolen from the home, or you may be able to add your bike onto your policy. However, some home insurance policies may not cover a bike if it's stolen from outside the home.

There may also be a limit on the value that can be covered, so if your bike is expensive, consider specialist insurance.

Graeme Trudgill, head of corporate affairs at the British Insurance Brokers' Association, adds: "Home insurance should cover any individual item up to the value of £1,500, but it depends on the policy."

Q: How do I choose a policy that's right for me?

A: What do you need from your insurance? Do you just want cover for loss and accidental damage or do you want cover for personal liability, in case of an accident involving someone else?

If others will be using your bike, consider adding them to your policy, as most policies specify that only the owner or named policyholder is covered.

There are relatively few cycle insurers on the market at the moment - ETA, Evans Cycles and Cycleguard being among the best - but there are several comparison websites where you can compare quotes. Check out

Q: How much will it cost?

A: Depending on the price of your bike and the level of cover, annual premiums can vary between £20 and £120. Work out your bike's value; if you want to cover extra accessories such as lights or mudguards, this will push the premium up.

Q: Are there any common exclusions?

A: Typically, insurers need to be satisfied that you've taken reasonable measures to prevent your bike from being stolen - if you don't lock it to a fixed object such as railings or a bike rack, the policy could be rendered invalid.

Some insist that you use an approved lock or will only cover the bike during certain hours of the day - for example, if your bike is stolen at night, you may find the insurer will refuse to pay out.

Q: What other things should I consider?

A: Read the policy's terms and conditions first. Bear in mind that there will be an excess on the policy, so if your bike is inexpensive, insurance might not be the best option as the excess could outweigh the price of the bike.

Some insurers also take into account bicycle depreciation, so if you've had the bike for a few years this could again mean insurance is pointless.

Aside from taking out insurance, focus on keeping your bike secure. While it might not deter a thief, registering your bike with the police and marking your postcode on the frame in a UV pen could help you get it back if it's stolen.

Keep a record of the bike's make, colour, size and any other distinguishing features – you could even take a photo of it.

Q: My bike has a minor fault from an accident that will cost only £100 to sort out. Should I pay for it myself instead of using my insurance?

A: Graeme Trudgill, head of corporate affairs at the British Insurance Brokers' Association, says: "The first thing to do is find out how much your excess is. If it's £50, you'll only save another £50 repairing the fault, but you'll lose your no-claims bonus, which will push up both your excess and your premium.

"Bear in mind that insurance only covers sudden and unforeseen instances, which typically won't include mechanical faults - you'll have to check your individual policy for details."

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