Road trip! Auto insurance for RVs
Want to get away from it all and still have the comforts of home? That's the goal of millions of Americans who take their vacations in motor homes, also known as recreational vehicles or RVs. Before you hit the open road, however, it's a good idea to check the insurance coverage for your RV.
"Most insurance companies have restrictions on how they cover motor homes," says Bert Alanko, chairman of the Recreational Vehicle Renters Association (RVRA) and owner of Phoenix-based MBA Insurance, a premier RV-rental insurance agency.
Insurers treat RVs differently than passenger cars or SUVs. The cost of RVs and the potential for extensive physical damage in an accident mean the ordinary coverage minimums that apply to passenger cars are too low. Additionally, because many RVs are driven by people who aren't accustomed to the extra size and length, insurers believe there is a greater risk for accidents.
Many car insurance companies offer RV-specific insurance policies to cover your vehicle, its contents and the perils that are specific to motor homes.
Some insurers will issue a certificate of insurance that applies to a motor home. In other cases, if you have rental car coverage as part of your insurance package, it will apply to a recreational vehicle, but only if your physical damage limits are increased. If your insurer will sell you coverage with higher limits, that might be your first choice. If not, you'll have to find an independent agent who can write policies in the "specialty market."
RV insurance misconceptions
Some people believe that the personal property in their RV will be covered under their home insurance policy. While this is true up to a point, home insurance coverage is limited when the property is kept somewhere other than the "residence premises," such as your personal car or your RV. Your car and homeowners policies may not cover such items as appliances, plumbing or accessories. Without proper RV insurance, paying for damage could come out of your own pocket.
RV insurance combines the protections offered by both home and auto insurance policies. That includes coverage for losses due to fire, smoke, theft, vandalism, landslides, hail, windstorms and collision. It also provides coverage for your personal property, emergency-expense coverage such as lodging and campsite/vacation liability coverage — which protects you if you use your motor home as a residence. It should also cover awnings, satellite dishes and other attached accessories. Additional coverage can be obtained if your RV is used as a semi-permanent residence for most of the year.
As with standard home and auto policies, RV policies renew each year. A car insurance quote for an RV is based on the type, size, and age of your motor home, where you live, how much you drive and your driving record. Premiums are also based on your age and gender, address at which the vehicle is principally garaged and your driving record. Many offer discounts for maintaining a good driving record or buying multiple policies with the same insurer. You can reduce your RV insurance premium by increasing your deductible.
Auto insurance for a rented RV
If you are renting an RV, you'll need to make sure you have adequate insurance. RV rental companies offer insurance, but it might not be the best deal. Here are some of the things to watch for when renting an RV:
Is the insurance included in the rental price? If not, does the stand-alone price make sense? Depending on your RV model, insurance could cost you $17 per day for a small RV and up to $28 per day or more for a larger model.
What is the deductible amount? Most RV insurance deductibles start at $1,000 and go as high as $5,000. How much are you willing to pay out of pocket if you have to make a claim?
Is the liability coverage adequate? Most states require motorists to carry liability insurance. Make sure your policy has adequate coverage for collision and comprehensive, too.
Is the dealer's policy primary or secondary? “If you are involved in an at-fault accident, a primary policy pays claims to the policy limits,” Alanko says. “If the dealer is covered by a secondary policy then your personal auto policy will be asked to respond first as ‘primary’ coverage, then the dealer’s policy will respond as ‘secondary’ coverage. That means that the RV rental policy will not respond until your own policy had exhausted its limits.”
Are the liability limits high enough? Remember that a fender-bender in a 27-foot motor home could cost $5,000, compared to $400 or $500 for a similar accident in your sedan!
Are you covered for towing? Half the fun of an RV vacation is traveling to remote areas far from fast-food franchises, motels and repair shops. If you have a breakdown 60 miles from the nearest mechanic, the bill for an oversize wrecker to come get you could be pretty high. Most RV rental policies do not provide towing coverage for breakdowns. Ask your dealer if he has a towing program.
Does the policy exclude drivers under age 25? Some policies include a flat-out exclusion. Others give the dealer leeway in determining whether a younger driver is mature enough to handle the vehicle. If your policy excludes a younger driver, an accident that occurs while the excluded driver is behind the wheel won’t be covered.
Are you covered for medical expenses if someone is injured? Check the medical payment and personal injury provisions of the policy. Some rental policies exclude medical payments and personal injury protection (PIP) coverage. Some exclude uninsured motorist coverage.
Buying an RV brings auto insurance challenges
If you decide to buy a motor home, you may encounter some of the same issues as if you rented. Not all car insurance companies are prepared to insure a motor home year-round, even if they offer temporary insurance to rent one.
“However, you may want to look into a specialty RV insurance policy,” Alanko says. “These policies provide coverage for items and areas that car insurance often does not cover, such as your belongings, increased towing, vacation liability and replacement cost.”