A colleague in the Tru-Tension office picked up a new bike recently, and it created a discussion about when you should cancel your insurance for your old one.

It can be extremely difficult to decide when to cancel your insurance for a few reasons, mainly because you don’t want to lose out financially or endure the inconvenience of being kept on hold by an insurance company for what feels like a lifetime.

It becomes complicated when:

• Your existing policy has plenty of time left on it
• There is a cancellation charge
• You are yet to find another bike
• You are not picking up your new bike for a while
• It’s cheaper to let the policy run out than to cancel

Some argued to let the policy ride out, until one of our team pointed towards the case of a man named Paul Duffy and his Kawasaki ZX10R.

As reported in Scottish media, Paul sold his bike to another biker and didn’t cancel his insurance policy. The buyer was then tragically involved in a fatal accident just one week later, with no insurance of his own.

By law, MCE – Paul’s insurance company – are liable for the collision and able to claim the costs from him in court. It was ruled that, because Paul gave an uninsured rider permission to ride a motorcycle on his policy, technically he had breached his contract and subsequently, faced serious financial problems.

When should I cancel my motorcycle insurance?

Best practice: You should cancel or transfer your insurance immediately after the sale has been agreed and paperwork completed, regardless of the cost.

Many insurance companies will let you do this online or over a 24h phone call. It’s worth making sure that you’ll be able to contact your insurance company at the time you are likely to sell your bike, if possible. For example, 9pm on a Sunday may not be the best.

The alternative is to cancel your insurance before you sell the bike, however depending which country you live in, you may need to register the bike as off the road. This also presents the issue of fire or theft – what if it is stolen or damaged in the meantime?

If you’re the type to change your bike every 6 months or so, perhaps do your research when comparing your insurance quotes. What are the ‘administration fees’ or cost of cancellation? Do they have an existing transfer policy?

Top tip

Demand to see that the new buyer has insurance before selling the bike or allowing it to be taken away, especially if they are intending to ride away. Be upfront about this in your advertisement.

Read more > Getting the best price for your bike