RV Insurance

[Ron]

Just a heads-up in case others might not be aware of this issue regarding your RV insurance policy. 

Today I was reviewing our truck and trailer insurance policies.  I don’t do this often enough since we have had the same rig for many years.  I’m probably the last one to figure this out but I learned something today that will save us a nice piece of change.  I learned that our insurance company sets the premium for the trailer’s comprehensive and collision based on the trailer’s value we declared to them several years ago.  The coverage, however, is for actual value at time of loss so this was causing our premium to be quite a bit higher than it could have been.  I checked the value of the trailer on the NADA website.  The insurance company was willing to accept the “low value” from NADA for computing the premium.  This is advantageous since regardless of what they accept and base the premium on, they will pay the appraised value at the time of the loss even if it’s higher than this NADA estimate.

From now on I’ll be changing this estimated value before every policy renewal.

---ron

[Devilishjim]

Interesting I guess I need to pull up my policy and read for awhile, I don't recall seeing a value in print

[sandsys]

4 hours ago, Devilishjim said:

Interesting I guess I need to pull up my policy and read for awhile, I don't recall seeing a value in print

Probably because value had different connotations in different situations. Some policies let you set the value and your premiums reflect that. Some use replacement value so as to not leave you unable to buy a replacement should something happen to your rig. Some use NADA's numbers as the value. Your policy simply tells you what YOUR company will do. If it is the third example above, your premiums should go down as your rig's value decreases. But, you may have to remind them to check on that which, I think, is what happened above.

Linda Sand

[Ron]

15 hours ago, sandsys said:

.... If it is the third example above, your premiums should go down as your rig's value decreases. But, you may have to remind them to check on that which, I think, is what happened above.

Linda Sand

Exactly!  I just assumed it would go down with age.  

Our Progressive policy has three coverage options.  When we first took out the policy we were required to state what its value was at that time and we stated it was worth what we paid for it (it was virtually new at that time).  Over all these years of renewals we were never asked again to update this stated value.  The trailer's value upon which the premium was determined was never stated on the document called "coverages" or on the document called "declarations".  I was aware that we had the coverage called "Actual Cash Value" and that our coverage would not exceed "the actual cash value" or the "rating base" whichever was less.

The only way I stumbled upon the fact that my premium was still being based on the trailer's value that I provided to them 10 years ago when I applied for this insurance was when I went to one of their web pages that allowed me to change my coverages and give me a new premium quote based on the changes.  There I saw that original value and when I changed that value to what NADA indicated as the estimated current value I found that the premium dropped significantly.  

So, the lesson learned is that you can not assume that your insurance company is adjusting the value of your RV as it gets older for purposes of setting your premium.  They will certainly adjust it if you ever have a total loss!  This certainly applies to any RVers who have Progressive Co. insurance and might apply to others as well.  

This change only affected my comp & collision premium but it reduced the total cost of the annual premium by 21%.

As an aside I also learned a couple more things about my coverage that may not be common knowledge unless one spends time studying their policy.  First, my policy makes a clear distinction between the coverage for property stored in a "storage shed" vs. a "a secured storage location".  Second I learned what my coverage for "loss assessment" was all about.  Full timers really need to understand these coverages and I'm disappointed with myself for not understanding them until now.

---ron

 

[SIBERNUT]

You better read that policy again. Most policies say they will pay the LESSER of the declared value OR the ACV

[Ron]

52 minutes ago, SIBERNUT said:

You better read that policy again. Most policies say they will pay the LESSER of the declared value OR the ACV

I don't disagree and I'm not sure why you think I do.  Most policies I'm familiar with will not reimburse above the actual appraised or NADA value unless you have a "total loss replacement/purchase price value" coverage.  To my knowledge this coverage is more expensive and generally only applies to an RV that is less than one or two years old.

[John]

I was comparing Progressive to Geico. I went with Progessive because I was importing an RV from Canada to the U.S. and the importer required it to be covered for the full amount in case of some unforseen mishap. I checked with Geico, and they would only cover the vehicle for market value. The vehicle has additions and has been altered and would cost far more to replace. Just my two cents.

[whj469]

Some insurance companies offer replacement value, mine does, Good Sam. They will do that for five years and then after that it can be agreed value.  When I got my first RV someone told me not to just add it to an auto policy because of the ACV that many auto insurance companies use. They pointed out that if you have the RV financed without replacement value you could owe more then they will give.

[freestoneangler]

Great info, thanks for sharing.  It would not surprise me that most insurance policies are set-up/worded in this manner.  Insurance companies have a long history of profit and low risk places to invest ones money... using "clever" tactics such as this explains some of that.

[Big Greg]

We have Allied/Nationwide covering our fifth wheel and have an "Agreed Value" policy which was the purchase price.  I'm sure I couldn't replace it today even at the original purchase price but that's far better than the current NADA value.  For the Agreed Value I'm willing to pay a higher premium.          Greg