A Rider’s Guide to Risk Management

Since I began riding in 1968, I have believed in the old adage “a motorcycle is the safest vehicle on the road – up to the point of impact”.

Although I have been fortunate in avoiding a serious accident I have, like most riders, come off the bike on numerous occasions.  Those incidents are a reminder that a serious accident can happen to you or someone close to you.

You have to ask yourself: in the event of a serious motorcycle accident, have I done enough to protect my family?

Statistics on motorcycle demographics consistently show that the fastest growing group of riders is 55 – 64 year olds.  Since 2008, this group has accounted for 50% of recorded motorcycle fatalities in Ontario.  This group also claims a very high percentage of the serious injuries sustained by motorcycle riders in Ontario over the past 7 years.

Why does it matter?  Because older riders are more likely to have families and children who are financially dependent.  When they are catastrophically injured, it doesn’t just affect them.  It affects their spouses and their families.  The overwhelming majority of riders injured in the past 7 years have been male.  The result is the female spouses often bear the burden of caring for the seriously injured spouse as well as replacing the income he contributed to the family.

This article is not intended to address the issue of rider safety.  Those strategies include careful selection of the type of apparel including helmet; selection of motorcycles with appropriate safety equipment including ABS brakes and continuing training in safe motorcycle handling and collision avoidance techniques.

My focus is on the role that insurance can play in helping riders and their families following a serious injury.

In Canada we are fortunate to have a comprehensive public healthcare system which provides medical management of the consequences of a serious accident.  However, the public system is supplemented by the privately-funded automobile insurance system.

There are two kinds of automobile insurance coverage.  The first is called third party liability coverage.  It is fault based and is usually restricted to the insurance policy limits of the at-fault driver.

The second coverage is called statutory accident benefits in Ontario.  There are equivalents in all of the provinces and territories.  These resources are generally paid on a “no-fault basis” by the rider’s own insurance company.

No fault benefits are available immediately after an accident and are intended to supplement the services available through the public system.  Resources include: medical and rehabilitation services like physio and occupational therapy; attendant care and housekeeping assistance, as well as weekly income replacement benefits.

Fault based resources are usually not available without a lawsuit against the driver responsible for the accident.  This is often a time consuming process which almost always requires the help of a lawyer with expertise in personal injury litigation.  These resources may be substantial but they are often delayed by the legal process and diminished by the costs of accessing that system.

Until recently, Ontario had one of the most generous auto insurance schemes in the country.  The Ontario legislature recently rolled back many of the benefits which were conferred on motorists in the late 1990s.  In the case of serious injury (catastrophic cases) the medical & rehabilitation and attendant care benefits have been reduced from a total of $2,000,000.00 to a combined total of $1,000,000.00.  Housekeeping benefits have also been reduced and the threshold for entitlement to the highest level of benefit has been considerably tightened.  The rationale for these changes is that it will reduce the cost of automobile insurance to the driving public.  In fact, this has never happened and is unlikely to happen as a result of these recent changes.  The real result is to significantly reduce the financial assistance that is available to seriously injured riders during their acute recovery period and, in the worst cases, for long term care.

The obvious question flowing from the increased risk of injury, and the reduction of the safety net available is: what can a rider to do make things better?  The first and perhaps least obvious step is to sit down with your insurance broker and review your coverage.  An insurance professional is well-equipped to discuss strategies to improve your safety net.  The first question you might ask is: what kind of reputation does my insurance company have for paying claims?  In my experience as a litigator in the insurance field over the past 35 years, there is a wide range of behaviours exhibited by insurers when confronted by claims.  You want to find an insurer that has the right philosophy – one designed to resolve cases and help its insureds rather than create conflict.

You can also ask to purchase the optional coverage which will restore your no fault accident benefit resources to the amounts that were available before the legislated changes which take effect in June 2016.  That relatively low cost strategy will provide significant and immediate assistance to you and your family in the case of a serious accident.

Finally, you can ask your insurance broker to increase your own third party liability limits to $2,000,000.00 or more.  This has the effect of protecting other motorists on the road but more significantly increases the limits of your under insured/uninsured motorist coverage which protects you from motorists who don’t buy enough third party liability insurance.  In effect your insurance company and your policy become the insurer of the at-fault driver in the case of an accident.

The very best way to avoid a serious accident is through rider skill and caution combined with protective clothing and a certified helmet.  However, when tragedy occurs, make sure that your insurance safety net is ready and able to handle the strain.

Article published in the March 2016 issue of Canadian Biker.