Luxury Transportation? The Skyrocketing Cost of Motorcycle Ownership in Israel
I received my motorcycle license in Israel in 2015, a year after I moved here. However, it took me another two years to get over the shock of the cost of owning and operating a motorcycle in the Holy Land before making the decision to purchase a bike. As a former resident of Florida where I last owned a motorcycle when I was younger, there were reasonable insurance rates as well as inexpensive bikes of all makes and models especially in the used market. In Israel, all drivers of any vehicle - scooters and motorcycles included - must carry "mandatory" insurance. This "no fault" insurance is required before any vehicle can be driven on the road. It covers bodily injury in the event of an accident and the cost is set by the government. Yes, you read that right - the government sets the cost of these rates and your insurance company merely collects the fee and issues the policy. Additional insurance, comprehensive, covers theft, third party, as well as repairs to your vehicle if you are found liable for the accident and vary depending on the company. As expected, the cost of this insurance depends on your age, type of vehicle, and driving record.
The high cost of this coverage, with only minor discounts for age and driving record, puts motorcycle ownership only in the thoughts of those who are most dedicated or need a license for pizza delivery. For example, a 40 year old riding ANY bike 251cc or higher (even that 1200cc) will pay $1417 for one year of mandatory insurance! Note that this is the rate for an individual that opts for the regular insurance and not for the "discount" version that has a 25,000 shekel ($7177) deductible! Those below the age of 40 pay a bit more but those below 25 get slammed with premiums that can often be double. Comprehensive insurance costs roughly 10% of the value of the motorcycle. However, the cost of this insurance is extremely expensive as bikes are worth about 2 - 3 times the cost in other Western countries due to import/customs duty, VAT, and the fact that each importer has a monopoly. There is one Honda importer, one Yamaha, and so on which jacks up the price on parts oftentimes by a factor of five. A $5 oil filter for my motorcycle in the U.S. costs $22 here in Israel.
I'm 55, have no tickets, accidents, or claims and own a 2013 Honda CBR250R, a basic 250cc motorcycle with ABS. The cost of my insurance is $1519 - $919 for mandatory and $600 for comprehensive. If I purchase a 2018 Honda CBR650F (650cc) motorcycle, my current future vision, my insurance premium will increase a whopping 53% to $2318! It's no wonder that few Israeli motorcyclists take comprehensive insurance and many - unfortunately - risk riding without any insurance. What about the cost of purchasing that motorcycle?
As you can see below, a 2020 Honda CB500X, the most popular motorcycle in Israel, sells for $14,635 at the Honda dealer in Tel Aviv. In the U.S., this motorcycle (with ABS and destination charge) retails for $7379, a whopping 98% difference. Want a new 2020 1200cc Harley Davidson Forty-Eight Special? Get ready to empty your bank account as it will cost you the equivalent of $30,833, a 173% increase over the U.S. price of $11,299.
Motorcyclists have been protesting the high cost of ownership for many years but to no avail. The government isn't listening and the costs continue to increase. With traffic jams increasing throughout the country due to poor planning of new housing developments, two wheels are one of many solutions (in addition to increasing public transportation) to lessening traffic but protests fall on deaf ears with those responsible for implementing policy at the Ministry of Transport, National Infrastructure, and Road Safety (MOT). New "HOV - high occupancy vehicle" lanes are not available to motorcyclists which only serves to increase the accident rate as two wheel vehicles must share the remaining lanes that are more crowded. In the U.S., these lanes are - by law - open to bikers.
A decrease in import/custom duties on bikes, parts, and safety equipment as well as lowering mandatory insurance rates could go a long way in increasing the number of motorcyclists, making Israel a more "biker friendly" country, and ensure that ALL bikers can afford to carry appropriate insurance. If the price of ownership does not decrease, riding may soon become a "hobby" for the wealthy. Ride safe!