Insurance

 

 
 RV Rental Insurance is a priority if you plan to rent your RV or Travel trailer.
 
It doesn’t matter if you are a private individual owner or a full-blown fleet rental dealer, two things are a must:
  1. No matter what you read or hear, RV rentals (even private RV Rentals) ARE governed by state-required laws for automobile rentals and you cannot legally rent out your RV to another individual without the license required in your state. some states do not have regulations and other states have strict ones. Florida is one state that has no regulations.

    If you operate without required licenses (if any), you are exposing yourself to all sorts of unpleasant liability for breaking the law. Call your county clerk to find out what license you need. It may only be a business license, or no license at all. It's worth checking with your state Department of Transportation, searching your state's Civil Code for the Auto Rental Laws that many times include RV rentals, and also call your County Clerk or the City Office in charge of the area you live in.

  2. You will need full commercial RV Rental Insurance coverage.

Many of the individual RV Rental owners I speak with offer the lament that they believe commercial RV Rental insurance coverage is “so expensive,” and they opt for 3 different scenarios. Some RV Rental Insurance options are not so good:
  1. Personal RV Insurance and getting a binder from renter (left with huge exposure-explained below)

  2. Website-provided RV Rental Insurance (paid for with commission from each of your rentals)

  3. Commercial RV Rental Insurance (best option even with the additional cost)
 
Using your personal insurance and asking your renter for an insurance binder is the worst possible choice for an individual RV Rental operator for the following reasons:
 
  1. Your insurer did not insure an RV that is used for rental purposes. A personal policy excludes rentals. If you had disclosed to your insurance carrier in the beginning, that you had intended to rent out your RV, they would not have insured your vehicle. This is cause for cancellation of your policy and most likely would not pay out in the case of loss or damage.

  2. An insurance binder from your renter does not normally work for private RV rentals. This means a binder from your renter will not cover your RV if you are not a commercially recognized RV rental business.

  3. When you don’t carry commercial insurance for your RV Rental (even if your renter is able to obtain a binder for a rental), and there is an accident or you need to make a claim, the occurrence will go on YOUR loss record, not the renter’s loss record. Not only does this leave you open to large liability losses, this is a problem because the more loss occurrences you have on your record, the higher your rates go and you could become non-insurable.

 

What are the major problems with website-provided insurance?

  1. The coverage minimums may not meet the coverage minimums required by your state. Yes, there is the 1,000,000 supplemental liability coverage, but this is a secondary insurance and not a primary insurance that kicks in for your vehicle
  2. The website employees are your first line of contact and are in control the claims process. If you are lucky, you will eventually get a true claims adjuster or claims specialist. According to public reviews, response time, overall communication and payouts are not satisfactory or in line with RV owner provided estimates.

  3. Your unit is only covered for the rental period, which means you still have to carry personal insurance as well to protect your RV when it’s not being rented, which adds to your expense overhead.

  4. The contract used for the website-provided rental may not contain “shift language.” Shift language is an important part of your rental. The shift language that is included in private commercial insurance policies “shifts” the responsibility of the occurrence to the renter. Even if your renter has purchased extra insurance for the trip, unless the rental contract has specific shift language in its body, the occurrence will go on your loss record. Have you read the insurance policy (not an “abstract” or “summary,” but the actual policy?

  5. Your RV damage or payout may not be a high priority on the website’s list of daily business. You can see from reading the reviews that many RV Owners have not been communicated with in a timely manner or in their opinions, been treated fairly.

Benfits of A Commerical Policy

 
  • Asset Protection:
The protection of the corporate veil is a safety net for business people. In other words, if there were a loss larger than the coverage of the policy and someone sued and was awarded a large lump sum of money, there would not be a chance of my losing other assets outside the corporation.
If you haven’t established your LLC or Corporation for your rental business, it’s best to take care of that right away. Also, this makes you qualified to purchase Commercial RV Rental Insurance.
 
  • Tax deduction:
When you are an RV Rental business operating under an LLC or corporation, your insurance expense (as well as many other expenses) becomes a tax deduction (talk to your personal tax advisor to find out all deductions you are eligible for).
 
  • Response time:
When there is a loss or claim to be made, you are dealing directly with your own insurance company that agreed to cover you; you will receive attention in a timely manner and in a professional way.
 

When you carry your own commercial RV Rental insurance policy, you are covered 24/7/365 and you don’t have to carry a separate insurance policy when your RV Rental unit is not out on a booked reservation.

Based on ongoing research of the RV Rental insurance options, the only solid protection for RV Rental operators is Commercial Insurance purchased directly from an RV Rental Insurance specialist.