The major motorcycle insurers, Hibernian and AON Bike Care, underwritten by AXA Insurance, have agreed to give 25 per cent discounts to owners of certain single-seater or "monoposto" machines.
Currently the machines recognised by both Hibernian and AON as qualifying for the 25 per cent discount are: the Aprilia SR50SS which has been specially created for the Irish market, Peugeot's Ludix One, and the Sachs Madass. Hibernian also accept the 749 and 999 Ducati Monopostos.
European legislation requires that all motorcycle insurance policies include cover for the pillion passenger. In an accident, even if it is not the rider's fault, the passenger has a claim against the rider. When this requirement was introduced by the EU, unopposed by Ireland, it resulted in a substantial increase in all motorcycle insurance cover. Whether or not a pillion passenger was ever carried, or even when the machine was incapable of carrying a passenger, all were affected.
The effect of the increases has been most keenly felt by younger riders. Prior to this legislation, during the boom-time years, small machine sales, especially for mopeds, had reached an all-time high.
As the effect of substantially increased premiums began to bite, sales dropped dramatically. Insurers also began to feel the pinch as fewer and fewer riders could afford the high premiums and premium income began to fall.
Niall Stephens of Bikeworld says that "the market is now dead". We know that in the past 18 months more than 20 bike shops have ceased trading.
It is claimed within the insurance industry, in defending recent premium increases, that pillion passenger claims had risen to account for 70 per cent of all claims. The bike dealers then challenged insurers on the basis that, if this was indeed the case, would they agree to a 70 per cent reduction for genuine single-seater machines? Apparently the first suggestion from Hibernian was a 10 per cent reduction, later raised to the present 25 per cent.
Commenting on the likely effect of this discount, Stephens said that "it is a good start, but it will take a lot of hard work to get sales anywhere near their previous levels". He added that "even 25 per cent off the €2,000 standard rate for an 18-year-old in Dublin with a 49cc moped still makes the net premium stupid money".
This 25 per cent reduction for single-seater machines will not, of itself, bring the bike industry back to boom-time levels.
However, coupled with the significant discount incentives for approved training that AON Bike Care and AXA will be launching in early February, some riders, even those on a Provisional Licence, could end up paying premiums half or less than the standard rate.
Motorcyclists should note that the single-seater reductions apply only to machines "designed and manufactured" specifically as single-seaters. They will not apply if you simply remove the pillion seat and footrests.