Increasing theft and accidents involving bikes are driving local insurance rates higher.

Two weeks ago, Police Commissioner Jonathan Smith announced that Bermuda's rise in crime was due mainly to a significant increase in bike thefts. In the second quarter of 2002, 340 motorbikes were reported stolen compared to 251 in 1996, when the problem was at its height.

And an average of 8.5 traffic collisions took place each day of the second quarter of this year.

Larry Osborne, vice president of the Argus insurance company, said that third party insurance for bikes has already gone up while plans are underway for comprehensive coverage to increase as well.

The hikes in premiums were in response to an increase in thefts and accidents causing cycle damage.

The changes are expected to be effective by September 1 and Mr. Osborne said that increases are common whenever the loss experience is bad.

While no changes have been made at Colonial Insurance recently, senior executive vice-president William Madeiros said that premiums will go up if the number of bike thefts continues to rise.

Calling the number of bike thefts "frightening", he noted that the figures for insuring bikes is already high. Still, there are many claims with which to contend.

"Its a real challenge to continue being in a market where it is not profitable. If there is no change in the trends we would have to consider increasing rates," he said.

He said a modest increase in rates was made earlier this year and nothing has been done since, but he added that the situation is being monitored. He also said he was hoping to start some dialogue with Police.

But he said that locking a bike twice, and u-marking it would have a "very definite, positive impact" on making a bike a lot less attractive to would-be thieves. Colonial recommends use of a Kryptonite lock.

Mr. Madeiros also said that there has been a definite increase in the number of accidents taking place.