Congratulations! It’s time to get your new motorhome insured!
You may be asking yourself:
- Who should you go to?
- Do you need specialized insurance from a specialized insurance agent for recreational vehicles?
- When is the best time to purchase RV insurance?
- How much (or how little) insurance do you need?
And each of these are valid and important questions to consider when purchasing your new home on wheels. To begin you should know that your automobile insurance does not transfer to your motorhome. It is required that you have a policy that matches your new investment immediately, before driving your new RV.
When considering insurance rates, prepare to be surprised. The lowest and absolute cheapest policy you can purchase is a liability only policy, protecting everyone from you but not your investment. This policy is only fit for those who are independently wealthy.
Full Coverage Policies
To say you “have full coverage” is to say almost nothing when you break it down. A blanket statement, such as that, explains no details as to what your policy does and does not cover. It doesn’t specify policy limits or restrictions.
Insurance policies vary a great amount dependent on which agency you use, as does the amount of coverage offered vary by agent. That is to simply say, there is no standard “full coverage” policy.
However, some insurance companies may write a recreational vehicle specific policy. In such cases, policies include coverages written specifically for motorhomes. No matter which insurance company you choose to insure your RV, be sure to include the following coverages:
Total Loss Replacement (TLR)
Sometimes also called Replacement Cost Coverage, TLR is part of a specialized RV insurance package designed to protect your financial investment in your recreational vehicle. Insurance policies with TLR will replace your RV in the event of a total loss. Typically, the replacement will be the same make, model, class, body type, size and comparably equipped.
Total Loss Replacement motor home insurance usually covers models less than five years old. Once your motor home passes that age, the coverage will be for the initial purchase price of the unit.
Purchase Price Guarantee (PPG)
In the case of a total loss, PPG coverage guarantees to pay out the amount stated on the policy paid for AND help you purchase a new RV. Application of this coverage will vary by agency and some companies may continue PPG throughout the life of the policy. Others may extend PPG to the 10th model year. In such cases, the policy will turn into Actual Cash Value (ACV) in the 11th model year.
Actual Cash Value (ACV)
This policy covers only the most current depreciated market value of your RV in the case of total loss. ACV is carried and preferred by most neighborhood agents. It should only be used as a last resort when TLR and PPG are not available.
Vacation Liability Coverage (VLC)
VLC extends to you, as the owner, while your vehicle is parked and being used as a vacation residence ONLY. It provides coverage when a suit is brought against you that relates to your campsite.
Full-Timer Coverage (FTC)
Owners who plan on living in their RV FULL TIME are required to carry FTC. FTC works just like a homeowner’s insurance policy.
Diminishing Deductibles (DD)
DD coverage can be described as the following: For every year you do not have an insurance claim against your RV, your deductible decreases by 25 percent. After four claim-free years, you acquire a zero deductible. The larger the deductible you are able to afford, the better off you are with DD coverage.
While the above coverage options should be a part of every motorhome police, there are additional steps you can take as owner to insure properties within or in addition to your RV. Personal effects, jewelry, golf carts, extended trailers and mini storage coverage can be obtained through most RV insurance specialists.
Be sure to ALWAYS SPEAK TO AN INSURANCE AGENT regarding your policy options and purchases. A third party can be consulted for ideas, but leave the facts to the experts. When it comes to your safety and the safety of your investments, information should never come secondhand.