Chelsey Tucker graduated with a Bachelor of History degree from Metropolitan State University in 2019. She now writes about insurance with her specialty being life insurance and has been quoted on Help Smart Phone and MEL Magazine.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years. He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Mar 19, 2020

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What Will Insurance Pay If Motorcycle Is Stolen

Insurance will pay out an amount equal to the cash value of a motorcycle if it is stolen and not recovered. Your comprehensive coverage is the portion of the policy that applies in this situation. Without comprehensive coverage your insurer will not pay a dime.

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It pays for damage caused by circumstances other than a collision. If the motorcycle is not fully paid for, the financing company will receive the payout and you will be required to make up the difference personally.

Cash Value v. Replacement Value

The cash value is what your motorcycle would reasonably be worth if you were to sell it today. The replacement value is what it would cost to buy a new bike of the same or similar make and model.

When you report a total loss, such as when your motorcycle has been stolen, the insurance company is not going to write you a check for the full replacement value. You are going to receive only the amount of the cash value, and you may not even see all of that money if the bike is not fully paid for.

As soon as you drive away on your new motorcycle, it starts to depreciate. It’s not uncommon for a motorcycle or car owner to be in a position where they owe more on the vehicle than it is worth. If you have taken out a loan to finance your motorcycle, the lender will probably require that you put collision and comprehensive coverage in place as a condition of advancing the funds.

Until the loan is paid off in full, the lender has a financial interest in the vehicle. The insurance company is going to pay the lender first, and any funds remaining will be paid to you. If you owe more on the bike than its cash value, you will still be expected to continue making payments, whether you have the bike or not.

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Gap Insurance Coverage

If you want to avoid being in the situation set out above, you can buy gap insurance coverage. As the name implies, this is insurance designed to fill the gap between the current value of your bike and what you owe on it.

Before you make the decision to buy gap insurance coverage, you need to understand that you are going to be paying for coverage that will provide a smaller level of protection over time for the same premium rate. As you pay down the loan, the gap between what you owe on the bike and the cash value gets smaller.

Consider gap insurance at the beginning of the loan period and re-evaluate whether this product is to your benefit annually. Your insurance company can tell you what the cash value of the bike is, or you can look up this information online to help you decide whether you should keep the coverage in place for the entire loan term.

Not all insurance companies sell this type of coverage, and it’s a good idea to shop around before making a decision about which policy to buy. Pricing will vary between providers, since each company uses its own formula to set rates.

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You could start by approaching your current insurance company about adding the gap insurance coverage onto your current policy options. You are not required to buy gap coverage from the same company that sold you your liability policy and you do have the option of buying a separate gap policy from another company if you wish.

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Shopping Around for Coverage

When you are looking for gap insurance coverage, either combined with collision, comprehensive and liability protection or on its own, do check out several insurance providers. Since each company writes its own policy provisions, you want to make sure that you are getting the best deal possible.

Visiting different insurance company web sites is a good way to learn about the companies themselves and the products they offer. You can request a quote for gap insurance coverage online, either on its own or in combination with other coverage options. If you are requesting other coverage at the same time, you may be entitled to a discount, so do keep this in mind.

If your motorcycle is stolen and not recovered, the insurance company will only pay out based on the cash value of the vehicle. In a situation where there is an outstanding loan on the bike, the lender is entitled to receive the amount you still owe first. Any money left over would be paid out to you.

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