Switching gears on e-bike insurance coverage: The wheels of the policies keep turning

June 23, 2022 – Can electric bicycles zoom into auto and home coverage? With fuel price ranges climbing, far more folks are turning to electric powered bicycles as solutions to cars. On Jan. 21, 2022, Bloomberg documented that U.S. individuals bought more electric bicycles (almost 790,000) than electrical motor vehicles (652,000) in 2021. (“America’s Ideal-Offering Electric Automobiles Journey on Two Wheels,” Bloomberg.com)

Electric powered bicycles, or e-bikes for brief, are bicycles outfitted with a motor. The e-bikes’ motor is commonly battery-driven and helps the rider with pedaling. E-bike motor assisted speeds are ordinarily capped at 20 mph, but specific e-bikes may well access up to 28 mph ahead of the motor guide ceases.

The kinds of e-bikes range. Some need to be pedaled to activate the motor, and some others have throttle-activated motors that propel the bike without pedaling. Some have each.

Not like bikes, e-bikes are like standard bicycles mainly because they can be pedaled and may not be subject matter to necessary licensing or insurance policies. Because they seem like typical bikes, cyclists are obviously inclined to trip their e-bikes everywhere they would journey a regular bicycle, including sidewalks and walkways.

Even though 20 mph may perhaps not appear quite rapidly, an e-bicycle hitting a pedestrian at 20 mph would impart much more drive than a expert boxer’s punch. This means incidents among e-bikes and pedestrians can trigger really serious accidents (and major liabilities).

Despite the fact that e-bicycle insurance plan exists, to place it mildly, not each individual e-bike proprietor has an e-bike plan. If you collide with somebody even though driving an e-bicycle, or are unlucky ample to be struck by a single, what insurance coverage would protect liabilities the collision triggers?

While condition-distinct vehicle laws may possibly call for motorists to have bare minimum insurance policy for motor autos, condition-mandated coverage could not implement to e-bikes.

For instance, Florida Statute portion 324.01 defines a “motor auto” to not contain a “bicycle, electric bicycle, or moped.” In the unpublished 2006 Florida Middle District Courtroom scenario, Geico Gen. Ins. Co. v. Schwinn, the court determined that a filth bike and ATV ended up not “motor motor vehicles” and did not have to have minimum car legal responsibility insurance plan.

If we utilize that identical logic, e-bicycle entrepreneurs almost certainly are not expected to insure liabilities arising from their e-bikes.

Contemplate this:

Sally does not have e-bike insurance. Sally even so rides her e-bike on an vacant sidewalk. When she turns a corner, Sally runs over a pedestrian she hadn’t found, resulting in major harm.

She miracles whether or not her residence or vehicle coverage could address the pedestrian’s health-related bills. If not, Sally might be struggling with severe money problems.

Personalized lines insurance coverage procedures, this kind of as vehicle and householders, include sure mishaps that induce bodily damage. On the other hand, dependent on their wording, car and householders legal responsibility insurance policies may not cover e-bike collisions.

Auto policy’s protection for four-wheeled vehicles

Sally may well search to her automobile coverage for liability coverage, pondering that a motorized bicycle is very similar to a motor car. Car insurance policy generally addresses sure auto accidents involving an insured’s vehicle. Protection for e-bicycle collisions is probably not likely underneath vehicle insurance policies, if the definitions and exclusions restrict coverage to four-wheeled automobiles or owned vehicles the policy lists as insured vehicles.

If Sally’s car policy addresses certain damages arising from an “insured automobile” outlined as a four-wheeled car shown on the plan, there would be no coverage for the e-bike. Her two-wheeled e-bike is not mentioned as a included car or truck on the vehicle policy.

On top of that, Sally’s vehicle coverage could excl
ude protection for mishaps involving cars with much less than 4 wheels. Courts have enforced this style of exclusion to bar liability protection for two-wheeled motor vehicles. For illustration, a 1993 Louisiana appellate circumstance, Gunn v. Automotive Cas. Ins. Co., utilized the exclusion for cars with fewer than four wheels to preclude coverage for a motorcycle accident.

Home owners policy’s ‘motor car or truck exclusion’

In contrast, homeowners insurance coverage commonly covers liability for mishaps caused by an insured, whether or not inside of or exterior the dwelling. Sally could presume that her owners coverage handles liabilities brought on by unintentionally putting the pedestrian with her e-bike.

However, a popular element in owners policies is an nearly universal exclusion for damages arising out of the use of a motor vehicle. No matter whether Sally’s electrical bicycle could be a “motor vehicle” is 1st established by how it is described in the policy.

If Sally’s owners policy defines a “motor car” to include electric bikes, then her e-bike is an excluded motor car. But if “motor vehicle” signifies a “motorized motor vehicle able of self-propulsion,” there could be protection for the collision. Sally could argue that her e-bike is not entirely self-propelled due to the fact she have to pedal it to activate the motor, so her e-bike does not fall within just the “motor motor vehicle” definition.

In the 1988 9th U.S. Circuit Court of Appeals case out of Hawaii, Allstate Ins. Co. v. Pacheco, the court docket located that a moped without the need of pedal assist was not a “motorized land vehicle” matter to the property owners policy’s motorized land vehicle exclusion. For the reason that the plan did not outline “motorized land automobile,” the court docket turned to Webster’s Dictionary, which described “motorized” to indicate “to equip with motor pushed cars” or “cars” or “to structure or adapt … for direct procedure esp. by an electrical motor ….” The court established it was affordable for an insured to be expecting owners protection for his moped, in particular if Hawaii statutes declared that “the expression ‘motor vehicle’ does not include things like ‘mopeds’.”

If Sally’s owners plan is silent on the definition of “motor automobile,” condition precise guidelines defining “motor car or truck” for various reasons may perhaps establish no matter if the motor car exclusion will use.

Supplied the increase of e-bike reputation, lots of states have their very own legislative definition of “electric powered bicycle.”

States these types of as Arkansas, Indiana, Mississippi, Vermont and some others have statutes expressing that an electric powered bicycle is not a motor car, at least for registration and licensing applications. Could these statutes support an argument versus making use of a homeowners policy’s motor auto exclusion? Except if the coverage definition involves e-bikes, they may.

Legal responsibility coverage for the pedestrian’s accidents possibly is dependent on whether Sally’s e-bicycle qualifies as a “motor car” as described in the procedures and below state legislation. If the e-bike does not slide in the homeowners policy’s “motor motor vehicle” exclusion, the insurance provider could possibly compensate the hurt human being up to the liability limitations.

As e-bikes turn out to be much more well-known (and result in additional significant accidents), insurers are probably to respond by revising householders policies to extra aggressively exclude e-bikes. For example, insurers could determine “motor auto” as “a land or amphibious auto that is self-propelled or capable of currently being self-propelled,” which would exclude most e-bikes.

If Sally experienced an e-bike plan with liability coverage, then the insurance provider would likely include the ensuing injuries and damages from the collision. But if Sally expects her property owners or automobile plan to address e-bicycle liabilities, she may perhaps be in for a shock.

When there could be typical developments in how states assess e-bike protection less than house owners and vehicle insurance policies, plan language and state guidelines change, and look to be evolving. When an electrical bicycle collision comes about, people who haven’t ordered e-bicycle protection will need to review their insurance policies and hope for the very best.

Erin Mindoro Ezra is a normal contributing columnist on insurance plan coverage for Reuters Authorized News and Westlaw Today.

Opinions expressed are individuals of the creator. They do not replicate the views of Reuters Information, which, underneath the Believe in Concepts, is dedicated to integrity, independence, and independence from bias. Westlaw Today is owned by Thomson Reuters and operates independently of Reuters Information.