Technical

Buying & Selling

Insurance:

Top Tips:

Always buy from a reputable company - This may be the insurance company itself (or probably more usual) an intermediary such as a broker or consultant. Whilst there are differences between broker and consultant (a broker, for example, must be a member of the Association of Chartered Institute of Insurers), it has to be said that, from a consumers point of view, there is little importance to be attached nowadays between the two - provided of course all are controlled under the Financial Services Authority. For the purpose of this section we shall assume the business you are buying from is a broker but our remarks equally apply to consultant or insurance company direct.

Know and understand basic insurance jargon before you start looking.

Be clear about what is covered/not covered by the policy - eg: foreign travel/breakdown etc.

Be clear about the terms and conditions of your proposed policy.

If you have special requirements/concerns/doubts, it is a good idea to put these in writing to the provider before you take out the insurance.

Know and understand the broker's own terms and conditions (separate from the insurers terms and conditions). For example some brokers charge fees over and above the premium on:

Installment arrangements:- If you are to pay by installments, be clear what premium and what administrative fees you are likely to pay - particularly if you were to cancel mid term.

Non-acceptance of your proposal by the insurer: When you take out insurance you normally receive a cover note which applies until the full policy is issued. If the insurer is not happy with your application and ultimately refuses to cover you, then you need to be clear what your financial liabilities are in those circumstances.

Shop around for the best deal.

But remember that the best deal may not be the cheapest. What, for example, is the reputation of the insurer in the event of a claim having to be made?

Complaints: Many brokers and insurers have their own internal complaints procedures. The following addresses may also be useful: General Insurance Standards Council, 110 Cannon Street, London EC4N 6EU - tel: 020 7648 7810 - fax: 020 7648 7808 - e-mail: enquiries@gisc.co.uk The Financial Ombudsman Service (UK), South Quay Plaza II, 183 Marsh Wall, London E14 9SR - tel: 0845 080 1800 - e-mail: enquiries@financial-ombudsman.org.uk Lloyds of London Complaints and Advisory Department, Lloyds, One Lime Street, London EC3M 7HA

Keeping the Premium Down:

	Keeping the bike in a secure garage.
	Fitting an alarm and the various security systems on the market.
	Agreeing to be responsible for the first part of the claim (known as a policy "excess").
	Developing and qualifying with advanced riding skills.
	Joining a club.
	Riding a classic bike.
	Going for a new bike where there are often insurance deals - but beware of later years.

MAJOR WARNING:

When taking out insurance don't tell lies - an invalid insurance policy can be disastrous for you. We have even known it lead to bankruptcy in the event of a claim against you. If for one reason or another your insurance company invalidates your insurance you are personnally liable to others

Financial Help:

When buying a bike financial help comes in various shapes and sizes. Broadly speaking however there are personal loans: hire purchase: dealer finance. As always shop around for the best deal and understand the small print before you commit yourself. A shorter period loan will generally be cheaper, but the instalments rather larger. Check the Annual Percentage Rate (APR) which determines what you pay for borrowing. Secured loans (using for example your house as security) will carry a lower rate of interest, but on the other hand you risk your house. However, there are many insurance protection schemes around and you should certainly think about that prospect very carefully.

Legal Aspects:

A sale or purchase is a legally binding contract carrying with it both benefits (rights) and the burdens (obligations and conditions). A sale from a dealer is called a "consumer" sale and carries with it many more rights than a transaction between two private individuals.

A consumer sale has the backing of the Sale and Supply of Goods Act 1994 plus other legislation. For example, a bike must be of satisfactory quality - but don't expect a silk purse for a sow's ear. A cheap old bike does not have to be in the same condition as a new, pristine one.

Another legislative protection for "consumer" transactions is a wide right of rejection.

A number of new consumer protections have been introduced over the last few years. One of these is the law surrounding the right to reject goods and to be put back into the position that you were before you agreed to buy.

At one time, the right to reject was short lived and easy to lose – sometimes lost within a few days of purchase.

Now under the Sale and Supply of Goods to Consumers Regulations 2002, the right may (effectively) be extended to 6 months. During that period the onus is on the seller to prove that any defect was not present at the time of sale. Even beyond that period your right may not be lost – but the evidential burden of proving defects may be rather difficult.

ONLY CONSUMER SALES ARE COVERED - NOT SALES BY A DEALER

Warnings:-
• Despite the 6 month period, you should always act promptly and not leave it until 5 months and 29 days.
• Also don’t suppose that trivial defects such as a loose connection that can be easily remedied will allow a right of rejection. On the other hand, a Harley Davidson dealer selling an £11,500 bike and forgetting to put oil in it can hardly complain when the engine overheats and the customer seeks rejection.

However, suppose the dealer acts totally reasonably, apologises, checks the machine over and assures you that all is well. You are prepared to accept it back but have reservations about what would happen if the assurances of the dealer prove to be misguided – and the machine ultimately proves to be irreparably damaged. In those circumstances can you preserve your rights?

Probably yes. But you should write to the dealer (keeping a copy) stating that you rely on his judgement, as an expert, but reserving the right to reject the bike - and whenever the defect is revealed.

To Buy or Not to Buy - That is the Question!:

BUYING THE RIGHT BIKE FOR YOU is an obvious (but all too often forgotten) point. ask yourself the following questions:-

	Do I want/need a scooter, commuter bike, sports bike or tourer?
	Do I have the correct level of riding skills to ride it?
	How much will it cost to maintain, repair and insure?
	Will it do what I want - eg commute, rally, tour?
	Are parts readily available?
	Will I be carrying pillion passengers?

 

Do I Want: An official import, parallel import or grey import?

Since most bikes are imported, yours will probably fall into one of these categories. An official import carries a full manufacturers warranty. It will be built to UK spec and there should be no problem regarding servicing. Also if there is a recall you will be notified. Whilst the cost may be more than one of the other categories you have a certain amount of guarantee against hassle. Parallel imports are bikes that are available from the official UK importer but are sourced from overseas. Initally when parallel imports came in, in the late 1990s they often had non-UK spec, but nowadays they are more likely to have UK spec. Grey imports are those that are not officially imported but built for a different market - for example Japanese.

Dealers/franchisees etc may be reluctant to assist with parallel and grey imports and there may be problems with conversion to UK spec.

Sometimes, even with an official import, the first date of registration in the UK may be well after the manufacture date. The bike, for example, may have done the rounds of European countries before arriving on our own shores for first registration.

With whatever category always ask pertinent questions:-

	What is the date of manufacture?
	(If a second hand bike) how long has the bike been owned by you?
	How many owners has it had?
	What is the mileage?
	Is it a UK bike or a type of import?
	Has it ever been in an accident/dropped or damaged?
	Is there any outstanding finance or hire purchase?
	Are any extras included with the price?
	Is it street legal? - if, for example, it has a race cam then you need to get the road legal system as well.
	Is it currently MOT'd and taxed?
	Are you the registered keeper and do you have a log book for it (ie a V5)?
	Have you got spare keys?
	Has anything been replaced recently?
	Has it been modified in any way?
	When was it last serviced?
	Why are you selling?

Boring Business:

HPI Checks: Checks the history of the bike to advise if there is any finance owing, if it has been written off in an accident or genuine - also checks the National Mileage Register (tel: 01722 422 422)

Log Book (ie V5): Ensure that the necessary procedures are followed with the DVLA and this document following a sale/purchase. The V5 provides valuable information about the machine together with the current and previous keepers. Remember that the registered keeper is not necessarily its legal owner. As a seller you should ensure that you complete the sale slip at the bottom of the V5 and send it yourself to the DVLA informing them of the change of ownership. If, after that, the bike is involved in an accident or a crime then you are covered.

Insurance: When you change your machine do not forget to tell your insurer.

Payment: Do not hand over a bike on the strength of a cheque - for small deals you can use cash - and for larger a banker's draft is more satisfactory.

MOT: Required on any machines over 3 years old.

Mechanical Matters:

Compared with car drivers the proportion of bikers with at least a basic knowledge of mechanics is probably much greater. So that when it comes to buying a second hand bike in particular, they do so with much more knowledge and skill. However here is a short list of checks as an aide memoir.