Motorcycle and motorbike insurance in Australia

What is motorcycle insurance?

Motorcycle insurance, like car insurance, can be taken out to cover accidental damage to other people’s property, harm caused to others, theft, fire or damage to your own bike. Aside from CTP, which is mandatory when you register any vehicle, motorcycle insurance is optional, but may be worthwhile for your own peace of mind.

Types of motorcycle insurance

There are four main types of motorcycle insurance. Here’s what they generally cover: 

Additional inclusions can also be found in standard policies or offered as optional extra cover for an add-on cost by insurers:

• Riding gear (safety clothing): Cover for clothing and protective safety items designed for motorcycle riding and worn by you (e.g. helmets, gloves, jackets, pants and riding boots).
• Replacement of keys and locks: Covers key and lock replacements if your motorcycle is stolen or maliciously damaged, or if you’ve lost/misplaced your key.
• Choice of repairer: Allows you to choose your preferred repairer rather than being limited to one partnered with your insurer.
• Hire cars: An inclusion where the insurer arranges a hire vehicle for you when your motorcycle is being repaired (and you are without a transport vehicle).
• Motorcycle trailer or sidecar cover. 

Regardless of the type of optional motorcycle insurance you choose, excesses (the upfront portion of a claim you must pay before your insurer covers the remaining costs) will apply. 

Keep in mind that add-ons are typically only accessible on comprehensive insurance policies. Some of these may already be a standard feature on some policies, but not all policies are made equal.  

What does comprehensive motorcycle insurance cover?

Comprehensive insurance policies across the market in Australia will typically cover:

Accidental damage

If your motorcycle is damaged during an accident, insurance providers will typically repair your motorcycle or compensate you for the cost of repairs. The maximum amount that could be paid would either be your agreed sum insured amount, or your motorcycle’s current market value.

If the motorcycle has been damaged beyond repair and has been registered for less than 12 or 24 months (this differs between insurance providers), you may be able to choose between receiving a replacement motorcycle or the sum insured amount.

Providers also usually cover costs associated with an accident, such as towing, clean-up of debris, and emergency expenses such as accommodation and travel.

Theft

If your motorcycle has been stolen, there are certain steps to follow when making a claim for theft, just like if your car has been stolen. The insurer will typically ask for a police report number and other details involving the incident. Some policies may have a waiting period before action is taken to allow time for police to search for your bike.

In order to be covered for theft, you typically must secure your motorcycle when left unattended. This can be storing your bike in a garage, locked shed or locking your wheel if you plan to leave it in the open. 

Attempted theft

An attempted theft of your motorcycle may involve damage to your bike, its locks and keys, and the place where you are storing it. Comprehensive motorcycle insurance often covers these types of incidents, but you will typically need a police report to qualify.

Damage caused by uninsured drivers

If you are in a collision with a vehicle whose driver is uninsured, your insurance provider will generally pay to repair the damage to your motorcycle. Most providers will cover the damage up to the sum insured amount while some have lower caps.

Natural disasters (storm, hail, flood, and earthquakes)

Your insurer generally covers damage to your motorcycle caused by a natural disaster, such as storms, hail, floods, or earthquakes. 

The definitions of what constitutes a storm, hail, flood, or earthquake can differ between insurers and policies, so it’s worth reading your policy documentation to find out what exactly you're covered for. 

Fire or explosions

Fire and explosion insurance covers everything from your fuel tank catching fire, to your motorcycle being burned by a bushfire or grassfire. Fire damage is also covered by TPFT insurance policies.

Vandalism or malicious damage

Vandalism or malicious damage means wilful and deliberate acts of damage to a motorcycle. Like attempted theft, insurance providers may ask for a police incident number if you submit a vandalism or malicious damage claim. 

What motorcycle insurance doesn’t cover

Motorcycle insurance policies in Australia typically don’t cover:

• Riding under the influence: Any incidents that occur when the motorcycle is being ridden by someone under the influence of alcohol, non-prescription drugs or medications hindering their ability to control the motorcycle.
• Business use: Any incidents that occur if your motorcycle is being used for business or commercial purposes. This includes using your motorcycle for hire, rider training, or taking passengers or delivering goods for payment. However, some insurers may offer a separate form of business insurance cover applying to motorcycles used for commercial purposes, or as an add-on to their standard policy.
• Illegal or unauthorised modifications: You will generally not be covered if any non-manufacturer modification has been made to your motorcycle that is not street legal, roadworthy or approved by the transport department in your state or territory. If you’re looking to modify your motorcycle, it’s best to contact your insurance provider directly to see if it will affect your cover.
• Motor sports or off-road riding: You will typically not be covered for any incidents that occur while you are using or testing your motorcycle in preparation for any motor sports, or using your motorcycle on motorcycle or dirt bike tracks.

How much does motorcycle insurance cost?

The cost of motorcycle insurance, also known as your motorcycle insurance premiums, is directly influenced by a handful of factors, such as:

• The type of cover you choose: Comprehensive cover costs the most, with third party property damage costing the least. 
• The make, model and age of your motorcycle: Newer and/or more expensive motorbikes typically cost more to insure. As your motorcycle gets older, the cost of doing repairs may be cheaper than comprehensively insuring it.
• The excess you’ve chosen: A higher agreed-upon excess equates to cheaper premiums, and vice versa. 
• Rider’s age and driving history: Nominated motorcyclists who are younger cost more to insure due to a perceived lack of experience (with possibly higher age or inexperienced rider excesses). 
• Security: Some insurers may offer a discount if your bike has security devices installed (e.g. an immobiliser or tracking device). 
• Where you park your motorcycle: Providers typically take into account the suburb your motorcycle is stored and its crime rate. For example, it costs more to maintain your cover if you’re parking your motorbike on the street instead of a secure garage. 
• Rider experience: Some insurance providers also offer discounts if you have completed a rider training course.
• Pay yearly instead of monthly: Paying to maintain your policy annually instead of monthly typically costs less overall. 
• Good claims history: Some insurers may offer a discount if you have a healthy claims history, deeming you a low-risk motorcyclist. 
• If you have a motorcycle loan taken out: If you have finance on your motorcycle, some lenders will require you to take out comprehensive cover. 

Canstar does not currently research and rate motorcycle insurance. We recommend shopping around and getting quotes from a range of insurance providers based on your individual circumstances.

Remember to carefully read the relevant documentation before buying a policy, so that you understand what you are and aren’t covered for.

How much should you spend on motorcycle insurance?

The amount you should spend on motorcycle insurance will depend on how you weigh up your budget and risk appetite. 

Consider your budget

Choosing the insurance that’s right for you will largely depend on your budget. Generally, the more cover you want, the more you’ll need to pay in premiums.

If budget is the primary goal, there’s no legal requirement to maintain any other motorcycle insurance policies outside of CTP, possibly saving you thousands of dollars. 

But, if you’re at-fault in a road accident where damage was done to other people’s property (and your own), you could be sued for all damages incurred. This could prove financially devastating if you don’t have enough savings to cover costs. 

Consider the risks

If you’re extremely risk-averse, comprehensive cover offers the highest level of protection, but at the expense of higher-end premiums. If you’ve maintained comprehensive cover for a while without incident, you could be paying more for cover you don’t actually need. 

The amount of risk you’re exposed to will depend on your bike, location and riding habits.