RV Insurance 101
RV insurance needs to provide specialized coverage to protect against two basic situations:
- It reimburses the owner in the event of loss or damage to a motor home, travel trailer, camper, fifth wheel, tent trailer, or hybrid.
- It provides financial liability protection in the event of a collision or RV crash that causes damage or injury to someone else’s property or person.
Why specialized RV insurance? Because RV insurance combines features of automotive and house insurance, it is designed to meet the specific needs of RV owners. Most states and provinces require that any motor vehicle be properly registered and insured.
Types of RV Insurance Protection
Most RV insurance packages will provide one of two types of insurance coverage
- All Perils – the highest level of protection, an all perils policy protects against all risks except those specified in a list of exclusions (usually acts of war or acts of God such as tornadoes). The most expensive option with the highest premium.
- Named Perils – the basic protection level. The insured often gets to specify the perils, such as theft, collision, wind, hail. Each specified peril increases the amount added to the premium.
Damage may be covered beyond a deductible amount that must paid by the unit owner, the same as for auto or home insurance. The higher the deductible, the lower the premium rate.
Types of RV Insurance Loss Protection
This may vary widely between provinces and states, and the terms used may differ, but there are three basic types of replacement coverage for total loss.
- Replacement Cost (Total Loss Replacement, TLR) – up to a specified amount and for a specified time limit. A policy might be for a maximum of $175,000 for the first five years on a new unit. After that time, the unit will be moved to Actual Cash Value. TLR generally has a higher premium than the other coverage levels.
- Actual Cash Value (ACV) – this policy pays the depreciated “fair market” value of the unit in the event of a total loss. This policy is the most common; the amount is always less than the owner expects. This coverage usually has a lower premium than TLR.
- Purchase Price Guarantee (PPG) – A policy may offer a fixed amount, the price actually paid for the unit, to be repaid against a total loss. This will also be for a specified period such as five or ten years, after which the policy reverts to Actual Cash Value (ACV).
These are the largest and most significant protections offered by RV insurance. Depending on the type (All Risk or Specified Perils) and level of coverage (Replacement Cost or Actual Cash Value), a policy can provide basic to excellent protection, with the premium of course increasing with the level of protection.
However, a good RV insurance policy will provide other important coverage, such as emergency vacation expense, public liability, property damage, and loss or damage to the contents of the unit.
While it is possible to get an insurance quote online, it’s well worth consulting an insurance broker or agent who is experienced in RV insurance.
RV Insurance for Public Liability and Property Damage
Beyond loss or damage coverage, however, it is necessary for the RV owner to have financial liability protection in the event of an incident caused by or in connection with the RV or its operation that results in
- Damage to someone else’s property
- Injury to any person
While most people will think of liability in regards to a collision or RV crash, other events can cause injuries or damage for which the unit owner may be held liable. Public liability insurance can save the owner from having to pay a settlement out of pocket. Examples might include
- A visitor is injured by falling off a step (or tripping on the outdoor carpet, or walking into an awning support, or…)
- Equipment blows from one campsite to another and damages someone’s rig
- The owner’s pet may cause injury to a person or damage to property
Some RV insurance will include Public Liability and Property Damage (PL&PD) coverage that comes into effect if the RV owner (or designated driver) causes an accident that results in damage or injury. This is typically a minimum of $2 million, and the premium will be higher for a higher amount or if the owner/driver has a poor driving record.
Roadside & Travel Insurance
Having emergency assistance coverage can help smooth out a troubled RV vacation. Emergency Vacation Expense Insurance will cover some expenses incurred if the insured RV is damaged to the point of being unlivable while the owner is on vacation. Some of the specific options available include:
- Travel Expenses
- Living Expenses
- Roadside Assistance
These services may be part of an RV insurance package, but they may also be provided as part of a membership in an RV club (which may also offer discounted insurance) or RV membership in an auto association such as Plus-RV from the Canadian Automobile Association (CAA) or American Automobile Association (AAA).
Free 24 Hour RV Roadside Assistance
Roadside assistance provides basic services required to get the rig back on the road in the event of minor mechanical issues such as a dead battery or an empty fuel tank.
- Fuel delivery (enough to get to the nearest service station)
- Battery boost
- Tire changes
- Winching service
- Lock and key service
- Minor on-site repairs where possible
If the RV insurance includes a tow benefit, a rig disabled by an insured peril may be towed to the nearest repair facility, regardless of cost. If an excluded peril caused the unit to become undriveable, the owner or driver must cover the cost of the tow.
A motor club Plus-RV membership or RV club membership will usually contain a similar provision for towing to the nearest RV service or repair center, or to a specified distance if the unit needs specialized service that cannot be provided at the nearest facility. The owner may be responsible for over-charges in these cases.
Emergency Living Expenses
If an RV is unable to move, or is otherwise unlivable, most RV policies will make some provision to meet the owner’s needs (accommodation, meals, toiletries) while repair work is being done. Such provisions do not usually have a deductible, but do generally specify a maximum number of days or a maximum dollar amount for coverage.
- Alternate accommodations such as a hotel or motel
- A per diem meal allowance (so many dollars a day)
- A daily allotment to cover all expenses, to a stated daily maximum or to a specified overall total
Emergency Travel Expenses
If repairs are going to take longer than the maximum insured living amounts covered, the policy or membership agreement may provide for alternate travel arrangements. These arrangements are not found in basic memberships or policies, and usually require a top-level membership or higher premium.
- A rental car for a specified time or dollar limit
- Flights home, to a set maximum
Membership in an RV Club or RV-Plus membership in an auto association is a great idea. Not only does it supplement RV insurance to provide some level of security for the expenses of emergency living, emergency travel, roadside RV assistance and RV towing, but membership can also provide a discount on RV insurance overall.
Personal Property & Contents
Is RV contents coverage worthwhile? Yes, it is.
The value of the contents of an RV is apt to surprise the average owner. Add it up: clothing, dishes, bedding, camping supplies, games, DVDs & CDs, electronics, personal supplies, cosmetics, medications, tools…. In the event of a total loss, the amount can be staggering.
Home Insurance Coverage May not be Enough
A home insurance policy will cover the contents of the RV to a certain extent. However, owners who count on the coverage provided by residential insurance often receive an unpleasant shock when making a claim (insult added to the injury of a collision or other disaster).
There may be limitations to the coverage of property away from the the home. How many owners read that multi-page policy carefully to see exactly what’s in it?
- Residence Restriction – Watch for a clause such as “Personal property normally kept at any other location you own, rent or occupy is not insured except while you are temporarily living there.”
- Time Restriction – Even if the coverage is there, it may be time limited. “Personal property stored elsewhere is insured for 60 days… After that, coverage will cease.”
- Excluded items – RV accessories are not covered by homeowner coverage (items such as TV antennas and satellite dishes may even be excluded for the home)
- Excluded Perils – “Specified perils means…Loss or damage cause by collision, upset, overturn…but does not include loss or damage to property in a vacation or home trailer which you own.”
The protection provided by home insurance is clearly limited. The answer is specialized RV insurance, which will cover the contents wherever the rig is, whether parked or stored or on the road.
Personal Contents Coverage for RV Owners
There are two common approaches to RV contents coverage.
- Replacement cost up to a percentage of RV unit value – the contents of the unit are covered up to a maximum amount expressed in terms of the value of the unit (But is that the replacement cost of the unit, or the depreciated value? If the latter, the amount paid for a contents claim could be very low)
- Replacement cost to a specified dollar amount – a less expensive route, with the premium being set by the maximum coverage selected.
Of course, whichever way the maximum is calculated, there will be a deductible amount that the owner must pay; the insurance will cover anything over that.
Coverage for RV Accessories, Add-ons, and Appliances
Some RV policies may also include coverage for RV accessories and add-ons such as
- Satellite dishes
- Add-a-room attachments
- Dining shelters
- Outdoor living room furniture
Sometimes special riders are attached to cover such things as
- Tapes, compact discs, DVDs, magnetic media, and other media in the RV unit
- Extended warranty on RV appliances – extends the manufacturer’s warranty for attached appliances
Such additional coverage may be included or may incur an additional small premium.
Specialized RV Insurance is Best Bet
Homeowner insurance packages may provide some coverage for the contents of an RV but only under certain conditions. For the most complete protection, specialized RV insurance or camper insurance is the best bet.