There are a number of factors to consider when deciding which coverage option would be right for you. A major consideration factor is the probability; in any given year, less than 0.02% of insured RV’s will suffer a total loss event.
The “ACV” coverage form is commonly the least expensive. In a total loss event, the carrier pays the current market value of the lost vehicle. The policy will show an insured value, but this value is not what they will pay, but instead is the ceiling on what could pay. The policy wording would read something like; “The insurance carrierwill pay the actual cash value or insured/stated value, WHICHEVER IS LESS.” When this form is used, our policyholders are reminded to confirm their values to minimize the policy cost. Being over-insured costs money and yields no benefit.
Under this coverage form, the carrier pays the insured value. We have carriers that offer this coverage form, but it can be pricey. It also may require the vehicle be appraised to set the initial value. Once the agreed value is set, annual updates are not required as the carrier will always pay the insured value.
This coverage form is written by all our carriers, but the form itself is not generic. During the first 5 model years the RV is replaced with a new untitled one, with this being the same on all the carrier endorsement forms. After the first 5 model years, the endorsement forms can vary widely. Some provide a purchase price coverage (like agreed value) for as long as you continue the coverage and own the RV, while others still require the policyholder replace the RV before full payment can be realized. In addition, some carriers put a 10 year maximum on the life of the endorsement.
The insurance policy is a contract between you and the Insurance Company. Your reading the coverage endorsements is necessary to understand what the carrier will do if a total loss event were to occur. Don’t be afraid of asking questions and needing information, as the worst question is the one that was never asked. When you talk we listen, as our knowing your expectations is paramount in providing the desired coverage at the lowest possible price.
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