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Laka is the membership-powered insurance for cyclists

Insure your bike - and everyone else’s - with community cover from Laka

13 Jan 2020

Insurers are notorious for trying to wiggle out of paying up. This is because they lose money whenever they settle claims, but that's the exact opposite of how community-based bicycle insurance specialist Laka works.

‘With other insurers, it can often be a battle to get things paid out as doing so eats into their profits,’ says Laka’s Jonathan Ramm, an insurance expert and owner of a Rondo gravel bike, plus a very fancy Specialized Tarmac.

‘We don’t charge anyone anything when they join. We only get paid once we’ve done our job for the community.’

Allowing it to always remain on the side of its customers, Laka’s unique community-based model sees the actual cost of insuring all members’ kit divided between each member every month. Rather than a fixed premium, riders agree to a maximum amount which is capped somewhere around the market rate for equivalent insurance.

‘At the end of the month, we add up all the claims and damages. Each member then gets charged their share relative to the value of what they’ve insured,’ explains Jonathan.

‘We then add a fixed 25%, meaning we only make money when we settle claims. This simple change lets us really focus on our members’ experience and completely aligns interests.’

As a result, each member’s amount payable fluctuates throughout the year. However, last year this model allowed Laka to undercut its competitors by almost 40%. The savings other insurers pocket themselves simply stays with the community in Laka’s model.

Reassuring to those who still prefer their insurance to be of the establishment (rather than up-start) variety, should an unexpected crimewave hit Laka is ultimately backed by Swiss insurance group Zurich.

*Laka looked at other bicycle insurers and put them up for a challenge: How much could you save with Laka when insuring bikes valued between £1,000 and £8,000?

Laka compared the last 12 months and used recent quotes with a London postcode. While cover may vary, Laka tried to keep it as comparable as possible. Bicycle insurers considered: Yellow Jersey, Cycleplan, Bikmo, PedalSure and Cycleguard (no specific order)

Get back onboard fast and with five stars

In keeping with its modern approach, Laka members do everything via their phones. Riders select the cover they need, then upload pictures of the bikes and kit to be protected. If something untoward should befall either, members then send a video statement explaining what happened.

‘This goes straight to our claims handlers, rather than a third-party, so everything remains in-house’, says Jonathan. ‘We aim to get claims agreed the same day and our members love the experience.’ Over 99% of reviews given to Laka are five-stars and they all speak about the same thing: Laka’s insanely good claims experience.

Offering replacement on a new-for-old basis, and not using the same depreciated value tactics of less scrupulous insurers, Laka will source the nearest available new equivalent to replace that which has been lost or damaged.

In the event of theft, this means you’ll be back on the road as soon as possible, but the same goes for other types of claims.

For instance, should a road user or cack-handed baggage handler damage your bike, Laka will payout, before pursuing the other side. With any money recovered returned to the communal pot, salvageable parts also get sold on. Split between members, when these recoveries are made, users will see them appear as a credit on their bill.

Community policing

Covering a group of cyclists with a shared passion, Laka reckons this community element keeps everyone honest. Instead of dealing with an insurance company that you know is just waiting to wiggle out of paying up, false claims will mean higher premiums for other users.

Incentivised to help keep the community and its bikes safe, each month members get an email detailing the claims paid out. Divided between theft and damage, this includes a breakdown of exactly what’s been paid for, from complete bikes to component categories and labour costs.

As a result, Laka has built up a huge database of incidents, allowing it insights into everything from trends in bicycle crime to the most effective bike-box or which airlines damage the most bikes.

‘We noticed lots of people were having their bars and shifters stolen,’ says Jonathan. ‘Thieves were just cutting through the cables and taking the whole lot.’

To remedy this, along with settling the relevant claims, Laka sent out Hexlox security bolts to ensure the replaced components couldn’t be stolen a second time.

Another recent move has seen the company alerting members of how to set-up their Strava accounts to avoid giving away details that could be helpful to thieves.

It’s all part of Laka’s cyclist-only cover. Meaning your machine won’t be lumped in with other users’ random gadgets and household contents, Laka also only covers bikes costing £750 or more.

Aimed at dedicated riders, this cuts out the large number of low-value commuter bikes that generate the majority of other insurers’ claims. Ensuring everyone behaves sensibly, riders will also need a Gold standard Sold-Secure lock if they want to leave their bike on the street.

Everything covered

Those requirements aside, Laka will cover many common cycling-specific situations not insured by other policies - such as if you leave your bike unlocked in the transition area at a triathlon. In fact, assuming you’re not racing at UCI level, or getting paid to participate, it’ll cover you in most races and events. Realising sometimes riders need to transport their bikes, they’ll remain covered inside your car, and there’s even a £200 taxi or bike rental allowance if you find yourself in difficulties far from home.

Even if you’re forced to spend time off the bike, Laka’s cover doesn’t rest up. Should one of its members suffer a serious spill, Laka's recovery kit comprises of a box of commiseratory Brewdog beers, plus the loan of a Wahoo indoor trainer, a three-month Zwift subscription and a cupboard’s worth of Tribe nutrition products.

Aimed at both cheering riders up, and getting them back in peak condition, it’s available free to members of the community that have suffered any kind of accident that’s put them off the bike.

‘We have members sending us drinks to say thanks for getting them back riding, or postcards when they’re off on their travels,’ says Jonathan. It’s not the sort of interaction you’d expect most people having with their insurer. But Laka wasn’t set up to function like the average insurer.

If you fancy seeing if their service might be a good fit for insuring your bikes, Cyclist has currently got a subscription offer - Cyclist readers can get £10 free Laka credit using the code Cyclist10:

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