Insurance Assurance

Full-Timer’s Primer
By Janet Groene, F47166
November 2002

When you decide to make your motorhome your full-time residence, one part of the process must be to take a look at your insurance coverage. The RV insurance policy you had as a homeowner and part-time motorhomer won’t cover all the bases. As a full-timer, you need additional coverage for the expensive equipment, keepsakes, and collections you carry on board, plus liability insurance for risks usually covered by a homeowner policy, such as if your dog bites the kid next door, or you zing a tennis serve into someone’s nose.

A typical RV policy covers fire, collision, theft of the RV or its equipment, emergency expenses, vacation liability (a visitor slips while climbing up the steps to get into the RV), vandalism, highway liability, and so on. The policy also may spell out coverage for damage caused by striking an animal, and falling objects. Usually, RV policies will cover lodging, a rental car, and/or transportation home if you wreck the motorhome more than 50 miles from home; these are known as “emergency expenses.”

In addition, full-timers need coverage for personal valuables that are carried on board. Modest limits apply to ordinary coverage for cameras, jewelry, and other valuables that might be carried in an RV. But to increase these limits, as many full-timers do, a special rider must be added to the policy, along with the additional premium. You also must verify the value of such items with an appraisal or receipts.

I talked with Larry Thum, owner of Thum Insurance Agency, C7123, in Grand Rapids, Michigan, to find out the latest insurance twists for full-timers. Mr. Thum works with many full-timers and numerous insurance companies, so he’s familiar with a wide range of scenarios.

In addition to Mr. Thum, there are many other insurance agents who are commercial members of FMCA and have experience writing policies for motorhomers. A list of these members can be found in the Business Service Directory, which was part of the June 2002 issue of Family Motor Coaching, or by visiting the Business Directory page at www.fmca.com.

Although full-timers usually are very knowledgeable about the basic insurance they must carry, Mr. Thum reminded me that those who own their own campsites may need extra coverage for “adjacent structures” if they have a storage shed or other structure on the property. Full-timers also may forget to insure the tow dolly, which may not be covered under the motorhome or auto policies. He said that many full-timers also are grossly underinsured for goods that are in secured storage facilities.

“Rates also depend on your “˜address,'” reveals Mr. Thum, “because states regulate insurance rules and rates.” Some companies determine rates according to the state in which the vehicle is registered. Other companies will use the owner’s mailing address. You may be able to save money simply by registering your coach in the same state where you obtain your driver’s license, vote, and pay income tax.

Mr. Thum said that at least some insurance companies offer discounts for:

• Membership in FMCA or other organizations. A few give double discounts for, say, FMCA membership plus membership in a coach manufacturer club.
• Antilock brakes.
• An antitheft alarm system.
• Air bags.
• Completing an RV or driver safety course (the agent needs to see the certificate you received upon completing the course).
• Holding a commercial driver’s license.

Mr. Thum suggests that full-timers review their coverage every year. “Situations change, especially with full-timers,” he said. You may have added a membership or an alarm system, changed the coach’s registration address, or sold your expensive coin collection. Take advantage of all the rates, deals, and discounts that are available to you. For example, if you lost your “safe driver” discount two or three years ago because of an accident, but you have been claim-free since, ask your insurance agent whether the discount can be restored. Otherwise, you’ll continue paying higher premiums.

A popular insurance policy feature is the diminishing deductible, which means that your deductible will decrease 25 percent per year (with no claims) until it reaches zero. For example, if your deductible starts at $1,000, it is reduced to $750 after the first year without a claim, and will decrease another $250 the year after that. By the fourth year, your deductible is zero. If you have a claim, however, you start again at the $1,000 level. Speaking of deductibles, you can reduce premiums by assuming more risk. While a $500 deductible is typical, some companies allow deductibles of $1,000, $2,500, or even $5,000.

Ask about available premium payment plans. Are they annual, semiannual, or monthly? Will the insurance company take credit card payments? Are electronic fund transfers possible? Can you make changes in coverage over the phone, or must they be done in writing?

Keep a running checklist related to your insurance coverage and go over it yearly. Discuss the details with your insurance agency and ask how you can get better coverage for less money. If you’re unsure whether you qualify for a discount, ask. For example, your rate may have quietly been increased, without further explanation, the year you turned 75 or 80 years old. Depending on your “home” state, the increase might be rescinded if you provide a medical certificate showing that your vision, hearing, and physical condition are good.

Here are several additional tips:

• Coverage for emergency services is usually $750 to $1,000. Additional amounts of this coverage can be purchased as well. That money won’t last long if you must stay in a hotel and eat in restaurants while the motorhome is being repaired. Some RV repair centers allow owners to sleep on board at the end of the work day, so make sure to ask whether this is possible.
• If your motorhome breaks down and you call for roadside service, clearly indicate the size and type of your motorhome. Mr. Thum said you may be talking to a phone bank operator who doesn’t know a Prevost from a Rialta. Be specific about the size and weight of your motorhome, or help might show up in a vehicle far too small to handle the tow.
• Know whether your emergency roadside service is paid for in advance or whether you must pay the tow driver immediately and file for reimbursement later. If you have to pay the driver, make sure to keep extra cash on hand and/or assure your credit cards aren’t maxed out.
• Know the hours that your insurer’s claims center operates, and whether you will speak with a person at the claims center itself, or will be forwarded to an answering machine or service.
• Make sure you understand whether you’re insured for the actual value or the replacement value of your motorhome and personal effects. The difference can mean thousands of dollars if you suffer a total loss.
• Keep detailed records of the items you carry on board and what they are worth. “Videotaping is easy and thorough, and photographs are a big help,” suggested Mr. Thum. One copy of the records should be kept somewhere other than in the motorhome.
• What used to be called “comprehensive” coverage now is often referred to as “non-collision” in insurance policies.
• Don’t be surprised if your insurer asks your permission to do a credit check on you. This isn’t just to make sure you’ll pay insurance premiums on time. A person’s financial history is being used more and more as a measure of their responsibility as a driver and an RV owner.

Health insurance
Affordable health insurance remains a stumbling block for full-timers who are too young for Medicare. Now AARP has introduced a plan for people ages 50 to 64 to pay benefits for hospital stays and selected services. Call (800) 523-5800 or visit www.aarphealthcare.com for more information.

What’s new
The Worldwide Multilingual Phrase Book ($12.50, Portside Language Service), by Eric Dondero, is a pocket-sized volume that provides essential phrases in dozens of languages. Languages covered in the book include Spanish, French, German, Scandinavian, Slavic, Greek, Hebrew, and many more. The author even provides a few words in exotic languages such as Amharic and Zulu. Although it may be difficult to make yourself understood by simply using the book’s sketchy pronunciation guide, those with an ear for language will soon catch on. The book can be found at bookstores, or online booksellers, or ordered from the publisher at www.portsidelanguages.com.

Topics Entertainment now distributes Rand McNally Deluxe Travel Software. We’ve been using the computer for trip planning for a couple of years, and it gets better with each new edition. With StreetFinder and TripMaker Deluxe, we can get where we need to go right down to the street address. The five-CD software set sells for approximately $39.99 and can be used with or without a GPS. It is available at retail chains including Costco, Sam’s Club, and Best Buy, and online at www.amazon.com.

The Portable Pet Home from Petmate is a folding pet carrier/crate made of heavy-duty 600D polyester fabric with PVC backing. Because it can be folded and stowed in a small space, the carrier is ideal for an RV. It comes with sewn-in stake loops and ground stakes for outdoor use. Features include adjustable ventilation, a sheepskin pad, and a screen mesh door. It’s sold by PetSmart online www.petsmart.com), and through catalogs such as Jeffers Pet Catalog www.jefferspet.com) and J.B. Wholesale Pet Supplies Inc. (www.jbpet.com).

Common Sense Self-Defense ($9.95, Hatherleigh Press) is a readable, well-illustrated guide written by police officer David Garcia and Stewart Smith, a former Navy SEAL. The authors begin by recommending ways to avoid threatening situations. But when all else fails, they suggest seven ways to protect your life or that of a loved one. The book is an interesting read and is very clear about what to do to when confronted with trouble. It can be purchased at bookstores, through online booksellers, or by contacting the publisher at (800) 528-2550 or www.hatherleighpress.com.