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>> Court: Ah, David Williams, you're the CEO and co-founder of Velosurance. You're one
of the original players and it sounds like you're nation wide. Can you just, you know,
expand on that a little bit and give me a quick, like, history of the company? >> Dave:
Bicycle insurance is not a new concept. It's new in the US, it's very big in the UK and
it's very big in Australia. We had dealt with Markel in general insurance for over 15 years
and when I conceived the idea of Velosurance I took the idea to Markel and Markel liked
the concept, they ran with it and it took them over three years to get the policy accepted
by all of the insurance departments in every state. >> Court: So, you know I... there are
all these questions floating through my mind. I've had cars, a regular car, and you like
have to get insurance in a lot of states because it's such a big thing and not only is it expensive
and it could get damaged, you could damage other peoples' property. Now when we're talking
about electric bikes now specifically, you know as I run ElectricBikeReview.com right
so that's kind of where I'm interested, and they're more expensive so you're spending
like $3,000 for a bike. I mean that's like a used car right there, so you know, what
does the product offer and how does this work. >> Dave: Congress considers a pedal assist
or an electric assist bike up to 750 watts, still remains a bicycle. >> Court: Yeah. >> Dave:
The homeowner companies and renter companies, if its got a motor, they don't want to know
about it. >> Court: There's this new movement towards like, speed pedelec bikes that can
hit like 28 miles per hour when you're pedaling. Right, the idea being like, well you can pedal
that fast so why can't the bike help you. And you've got like the Specialized Turbo,
Stromer ebikes and some of the IZIP bikes like the E3 Dash. Are those covered under
your policies too? >> Dave: Yes, it's up to 750 watts. After 750 watts we're out of the
game. >> Court: In addition to the bike, like can you also, does it also cover accessories
and stuff? I mean, I've poked around the website and you can spend a lot on lights and GPS
units and you know, different things like that on your bike. >> Court: Yeah, well that's
one of the biggest questions we get asked is "How much should I insure my bike for?"
I paid $3K for it but now I've added a whole bunch of stuff to it. And our answer is, when
you get ready to step on that bike, how much is it worth at that time. And that's how much
you should insure it for. >> Court: Okay, can we do like a buildout scenario? >> Dave:
Depending on where you are, the country's divided into three tiers. Southern, where
you can ride 12 months of the year. Central, where you can probably ride twelve months
of the year but there may be some days you don't want to step out the front door. And
Northern, where you spend six months riding and six months ice fishing. >> Court: Yeah!
Got it. >> Dave: So, it really depends on where you are but if you were in North Carolina,
$100 would buy you a policy on about a $1,200 to $1,500 bike. So, you know if, to use a
ballpark figure for everywhere in the country I would say 7% or seven and a half percent
of the value of the bike. So, if you've got a $3,000 bike, somewhere around $200 a year
to insure the bike against physical damage and theft. Okay, what about the whole, you
know that liability piece because for me, let's say I have a $1,500 entry level bike.
If, I don't, you know that's replaceable but if I like scrape someone's car or something
or I hit someone on the bike path like, that could be a big deal. >> Dave: The technical
aspect of liability is for, we will pay on your behalf those sums that you have become
legally liable for. Now, when someone says legally liable for. Okay, now that brings
a court room into it or at least a lawsuit into it. So, in order for you to, in order
for liability to kick in there is attorneys involved at that point. >> Court: Okay >> Dave:
So, yeah you're riding down the road. You crash into the guy's $300,000 Ferrari and
his insurance company pays for him but says "Hey, who is this guy that crashed into you
and whats he got?" They came after you for $12,000 repair, and here's where it gets weird.
If you were on your regular Trek pedal bicycle and you did that, your homeowners insurance
company would step in and pay it for you. >> Court: Hmm, that's cool. >> Dave: But,
because your bike now has a motor, we'll find that a lot of homeowners companies will either
exclude it or deny your coverage because you didn't tell them that it had a motor. You
know, insurance companies, with the exception of Markel of course, insurance companies are
not kind and benevolent companies. They have a bottom line that they have to meet. They
have shareholders that they have to make money for. So, they're very persistent about what
they will and won't pay. And if their contract doesn't specifically say that they're going
to pay for your electric bike damage, they're not going to. >> Court: So, but you guys would
in that case, like with the $12K. >> Dave: Yeah, it's about $42 per year to buy ~$25,000
in cycling liability. It only covers you when you're riding the bike itself. But the most
important thing about buying liability is that you're buying a defense. >> Court: Yeah.
>> Dave: I don't know about you but I can't afford a $400 an hour attorney. Car insurance
companies don't want to cover it because it doesn't have a VIN number. >> Court: Oh, I
see. >> Dave: And homeowners insurance companies won't cover it because they consider it like
a motorcycle or a scooter that should be insured by your car insurance company. So, you're
caught between these two companies that have these rules that won't allow them to insure
something as sensible as a bicycle with an electric assist motor in it. >> Court: It
is sort of a gray area and yeah, people want to be safe and cover themselves. And being
responsible here, it's just it's interesting, I'd heard a story about someone who there
was a flood near their house and the flood wrecked the house but like a tree fell over
on their house and the insurance company was like "Oh, we don't cover trees falling on
your house." You know, it was like "Ahh! What do you mean, the tree fell because of the
flood." Or, you know so, anyway, that's just a side note but it's nice to feel like there's
a company out there that's focused on this. And then the other thing was travel, because
a lot of people with the folding electric bikes, they put them on their boats, their
RV's, they take them on planes and then, now they're not "home" right. Is that covered?
>> Dave: Yeah, we can do word, we do worldwide coverage. Um, it runs about 10% of the premium.
So, you know, if you have a $250 premium, to insure your bike that you're going to take
to England and tour around the countryside on would cost you another $25. >> Court: Okay,
and that's worldwide. What if you're just in the US. Like, I live in Colorado, if I
go to Arizona on a trip, do I need the worldwide coverage or? >> Dave: No, you don't need to
tell us. You're automatically covered in the USA and Canada. >> Court: I noticed on the
website, you know I was reading through your frequently asked questions, it's a pretty
cool page. And it said, you know, you're covered for racing. I don't know too many people who
do electric bike racing at this stage but you're also just like regular bicycle insurance
and there are a lot of athletes who do triathlons so that was nice to see. The other thing I
noticed in that section was that like, if you're a bicycle messenger, say in New York
City where you've got a lot of of people who actually do use electric bikes, and there's
legal controversy, if you're using it for professional means like then it's not covered.
Is that right? >> Dave: That's right, we are strictly personal use coverage. The risk of
commercial use is dramatically different than someone who's a weekend fitness rider. We
just can't cover that risk. >> Court: There's another type of bike out there, it's not a
full electric bike, it's an electric trailer. It's called the Ridekick, and I think there
are others too but would that be covered somehow? >> Dave: We're still working on that. If it
could be considered an accessory that is connected to the bike then it will be insured. But,
it's still something that, we've only just become aware of the Ridekick and we're working
with the underwriters to see how and if it will be covered. >> Court: So what's your
process like if a bike is stolen or wrecked or something? >> Dave: So, when you have a
damage, the first thing you do is you call Velosurance. We handle all the claims through
our office. You call us, we know what the claims department at Markel needs. So, we
put the claim package together. So, when we send it to them it's complete. They don't
need to ask for anything else. We have everything in your file, we send it to them with a statement
and a loss notice. So, you damage your bike, take it to a trusted partner shop, they give
you a repair estimate, give the repair estimate to us with photographs of the damage, that
becomes part of your claim file that gets sent to the insurance company. The bike is
covered for any type of direct physical loss. If you lay your bike down, you hit a rock,
you hit a tree, you hit something else, you damage the bike - that was accidental, it's
covered. If your tires wear out, that's not accidental, we knew they were going to wear
out the day we bought them. So, that sort of stuff is not covered. >> Court: Is the
original value of your bike insured and do you get that money, can you explain how that
works? >> Dave: Yeah, if it's $4,000 today and it goes away in five years time, it's
still $4K. We do not depreciate the value of the bike over time. >> Court: What is the
deductible on these plans too, is that? >> Dave: It's, you have a choice of $100, $200, $300
or $500. The $300 deductible is the best deal, it's where you see the best savings. Of course,
the $500 deductible is the lowest premium but, if it's only $20 difference between $500
and $300 and ever had a claim and you've got a $200 difference. That's 10 years, you have
to dig out of that $200 hole at $20 a year. >> Court: What about friends riding the bikes?
>> Dave: The policy is permissive use policy. Which means, you can loan your bike to anyone
you want to. If you have liability, if you have medical then they are insured as if they
were the owner of the bike. >> Court: That's awesome, and I call that out with regards
to electric bikes specifically because, since they're still kind of a new technology in
America and people are like "What is that!" you know, I just know that there are more
of these situations where you're like "Give it a try!" and they're like "Ahhh!" and they,
you know... So, it's great to hear that. I think that that alone is a really great benefit
of the product. >> Dave: One of the most important coverages for anyone who rides a bike to have,
if they have an auto policy, is to have uninsured motorist coverage on the auto policy. Not
many people know that the uninsured motorist coverage on an auto policy covers you, no
matter what you're doing. In order for your uninsured motorist to kick in, there has to
be contact between you and the other car and the other car has to have no insurance, little
insurance or be a hit and run. And, that other car, if they hang around, has to receive a
ticket in order for you to show that it was their fault. For those people who don't own
cars, and who don't have uninsured motorist, our policy has an optional coverage called
vehicle contact protection which is medical payments up to $25,000 if you are, once again,
injured by contact with the car. Everyone at Volosurance is a cyclist. We all know what
you're talking about, we look at every quote request that comes in, we look at it and analyze
it. And we make sure that no one is ever quoted on a policy that could duplicate coverages
that they already own somewhere else. In other words, if we look at your application and
you've requested vehicle contact protection but you live in California where you more
than likely own a car, we would take that out of the quote and then send you an email
and tell you what we've done and ask you to tell us if we did the right thing. >> Court:
I appreciate the time! >> Dave: Okay Court, good to see you! Good to talk with you and
thanks for hanging out with Velosurance.