There are no agreed upon standards within the insurance industry for RV’s making it totally up to the consumer to determine their needs and then to find out what the various insurance companies are offering. Basing your purchase on price only can be a huge mistake if you ever need to make a claim. The bargain basement price for insurance I was quoted was $600 for full-time coverage. The highest price was nearly $1,600. There were others in between. Part-time or pleasure usage (defined as using the RV for less than so many months a year) coverage was approximately $100 less.
From the beginning I found myself wanting the more expensive policy but naturally wanted the cheaper price tag. After calling around and getting more information, I began to understand the differences. Some of these things I’ve mentioned in a previous post but I’d like to put it into one post so it will be easy to find.
First, let’s look at the worst case scenario, totaling one’s RV. It is imperative to find out what price the insurance company will use when paying you for your vehicle if it is totaled. I had no idea that RV values were not standardized. Because companies use different sources for RV valuations, they can end up paying out hugely different amounts. Between the lowest and highest valuations was a difference of 25%! One agent was not able to tell me what the valuation the insurance company would use. He told me that for a little extra they would insure me for the purchase price which in my case was still far less than the other valuations. Admittedly at this point my eyes glassed over and I stopped listening while crossing this company off my list.
There is a secondary issue. The valuations I mention above do NOT include RV attachments. Those attachments are paid out on yet another schedule. Attachments are defined as things like the awning, refrigerator, stove, generator, etc. – things that are attached to the RV. These differences can be also be huge. The company with the most expensive policy pays off attachments as replacement cost whereas the lower cost company will pay those same attachments but at a depreciated value. When I asked for the schedule used for those depreciated values, the agent was unable to get it for me. Clearly it would not work in the insured’s favor. Replacement value versus depreciated value will certainly add up, further increasing the difference in the check one would receive if their RV was totaled. How much of a difference would there be? Hard to say since that information is not easily obtained unless an underwriter is willing to give you those details but I’m sure it will increase the 25% difference I mentioned earlier. For an older unit like mine, this could be the difference between getting back out onto the road after a major accident and having to call it quits because of not getting enough money to adequately replace the RV. Worse still, if one has financed their RV they might even be in the hole if they have not prepared for this issue!
As expected, there are also differences in coverage for personal possessions. There appears to be a standard in how much initial coverage is offered although this is something that should be verified. The policies I checked out all offered $3,000 in coverage as a starting point. For most full-timers this would not be enough. Again, that coverage can be either full replacement value or depreciated value. Even more of a concern for me is that some policies have a cap of only $1,000 per category. If you traveled with, say, an iPod and a Macbook Pro, you would only receive $1,000 for your computers no matter the cost since that is the category cap. I did not ask if this company offered ways of getting around that $1,000 cap. An insurance company that look to protect itself to that degree is not an insurance company I want to do business with since I’m pretty sure I’d be on the short end of the deal with any claim I might submit.
All of the policies I reviewed offer increased coverage for personal possessions for an increased cost. Those costs are relatively minimal relative to the cost of the overall policy and well worth the additional cost if you have more than $3,000 worth of possessions in your RV. Theft is always a very real possibility. I want to know that if I get robbed I’m covered and the only thing I have to deal with is the feeling of invasion, not the devastating loss of things I cannot afford to replace.
Each company offers a variety of other coverages including things like paying for hotels, food and a rental car when an RV is being repaired. At least one policy offered some coverage for things left in storage while on the road full-time. Those things, for me, are more incidental and, while important, not nearly as important as the things I’ve already reviewed. It isn’t a surprise that as the premium increased so did the value of these additional coverages.
Some might be tempted not to tell the insurance company if they are full-time in an attempt to save money. This would not be a wise decision since the increase in premium covers increased liability insurance. If one still owned a home, their homeowner’s policy would include that additional liability. Without that additional liability coverage if one is sued, at least in theory, one could potentially lose their RV or other assets to a law suit. From my vantage point, best not to tempt fate. Besides, best not to file false information with the insurance company.
Finally, one should interview the insurance company and ask as many questions as they need to until they are comfortable with the answers they receive. Obtain BBB ratings as well as reviews from other RV’ers. Especially for full-timers, a company that deals exclusively with insuring RV’s is a necessity since they are better able to give coverage more in line with full-timer’s needs. Be leery of companies providing insurance predominately to automobile owners, particularly if you are full-timing, since their policies are often not geared toward people living in an RV. You would think it would be easy enough to somehow combine the relevant parts of both automobile insurance and homeowner’s insurance to come up with a policy that is appropriate for a full-timer but evidently that is not always the case.
My choice at this time? National General Insurance. Their policy appears to be the most comprehensive for my needs. My tolerance for risk is minimal so I’d rather pay more and get more coverage. I have no desire to deal with surprises. For you it might be different. Each of us has different thresholds we need to address.
If you have anything additional to add to my perspective please do not hesitate to add it within the comment section. By far I’m not an expert; just someone who is sharing what I learned through my experience.
© 2014 deborah kauffeld