On the Road Again: RV Insurance Tips

More than 483,000 recreational vehicles (RVs) were shipped to dealers in 2018. This represented a drop from a record year in 2017, but it was the second-highest annual total for RV sales.1

Although RVs are sometimes associated with retirees, ownership is increasing more quickly among younger people while the percentage of older owners is generally holding steady. In 2018, more than one out of five households headed by someone age 35 to 44 owned an RV.2

One reason for the popularity of RVs among people of all ages is the potential for more frequent, lower-cost vacations. A recent study found that an RV vacation costs 21% to 64% less than other vacations for a four-person travel party, even after factoring in the cost of fuel and RV ownership. For a two-person travel party, savings are 8% to 53%.3

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Insuring a Vehicle-Home

If you own an RV or are planning to purchase one, it’s important to understand the types of insurance coverage available. An RV is a hybrid — part vehicle, part home — so it may be wise to carry more specialized insurance.

Appropriate coverage depends on the type of RV, the way you use it, and the level of risk you are willing to accept. RVs come in many different shapes and sizes, including large Type A motorhomes (conventional motorhomes on a specialized chassis), Type B motorhomes (van campers), Type C motorhomes (built on a van chassis with a wider body section), and a variety of travel trailers — from large conventional or fifth-wheel travel trailers with deluxe amenities to smaller expandable camping trailers and tent pop-ups.

Is Separate Coverage Required?

If your RV is a motorized vehicle (Types A, B, or C), most states require the minimum liability insurance that is required for auto insurance. Of course, just as with auto insurance, minimum liability coverage would leave you exposed to a broad range of potential losses.

Regardless of the type of RV, you will be required to carry specific insurance if you financed the purchase and are still paying off the loan or if you are renting the RV.

If your RV is towable, liability insurance will typically be extended from your auto insurance policy. So if you own a towable RV outright, you may not be required to have separate coverage, but you should consider additional coverage for your RV, either under your auto policy or a separate policy. Some towable RVs are as big and expensive as the largest Type A motorhomes.

Auto Insurance or RV Insurance?

You may be able to add your RV to your auto policy, with the same choice of coverages as you have for your other vehicles. However, doing so might not provide adequate coverage for personal possessions, accessories, and liability related to the RV lifestyle.

A specific RV policy would typically include coverage similar to a standard auto policy, such as bodily injury, property damage liability, uninsured/underinsured motorist, comprehensive, collision, and medical payments (up to the policy limits), as well as additional options. Some policies may offer higher limits than standard auto policies and could provide a coverage package that is more appropriate for recreational vehicles. For example:

Total loss replacement — Provides a new, comparably equipped RV if your newer-model RV is damaged beyond repair within a specified time period (often the first several years). Other collision and comprehensive insurance options, which are typically less expensive than total loss replacement, would replace your vehicle based on market value or agreed value, depending on the coverage you choose.

Personal property — Pays for replacement of personal items in your RV, such as cameras and sporting goods. Standard homeowners insurance might cover personal items (up to policy limits) for the first 30 days, but the amount may be reduced significantly after that period.

Vacation liability — Pays for bodily injury and property damage losses that occur at your campsite or in the area around your RV.

Emergency expenses — Pays your expenses for hotels and transportation due to a covered loss.

Awning or custom equipment — Pays to replace a damaged awning or aftermarket equipment such as a satellite dish.

Trailer and golf cart — Provides extra coverage if possessions you tow behind the RV — such as a trailer or golf cart — come loose on the road.

Pet injuries — Pays up to a maximum (typically $1,000) for veterinarian bills if a pet is injured in a loss that is covered under comprehensive or collision coverage.

Other types of coverage that may be available include windshield damage, roadside assistance, fire department service charges, and special coverage for travel in Mexico.

Are You a Full-Timer?

If you live in your RV for extended periods of time, you may require full-timer coverage. The distinction between this type of coverage and standard RV coverage varies from company to company. For example, one company might define a full-timer as someone who lives in an RV for five or more months in one year, whereas another company may consider you a full-timer only if you have no other place of residence.

Typically, a full-timer policy is similar to a homeowners insurance policy, and it might offer additional coverage for items in a storage shed, expensive jewelry in your RV, or a golf cart that you drive in the area around your campground.

Whether you’re a part-timer or full-timer, an RV can be a great way to travel. Be sure you have appropriate protection before you hit the road.