Lien on a Motorcycle: Do I Need Full Coverage?

Reader’s Question:

Do I need full coverage if I have lien on my motorcycle?

George

Yes, if your lienholder states you have to have full coverage, then you definitely should have Collision and Comprehensive insurance policy on the motorcycle.

If you own an automobile or motorcycle with no lienholder, you can put whichever kind of insurance you would like on it, so long as it fulfills your state’s minimum insurance requirements. Nevertheless, if you have financing with a loan company, or a lienholder of some other kind, they are able to designate what kinds of insurance coverages you have to carry on that automobile, as it is often their property until you pay off in full.

Any lienholder on a motorcycle, or a different type of automobile, will usually need physical damage coverage of Collision and Comprehensive because they’re what safeguard the bike if it’s damaged.

Collision will pay if the motorcycle is damaged because of a major accident in which it hits, or is struck by, another automobile, or other object.
Comprehensive will pay if the motorcycle has losses caused by occurrences other than collision, for example if it’s stolen or destroyed by flood, fire, or animals.