Individual policy wordings should be checked. However, a typical policy will provide cover for loss or damage to the caravan its equipment and contents whilst the caravan is stationary or being towed.
A sum insured will be set for the caravan, equipment and contents.
These can include:
- Storm and flood
- Accidental damage.
The following are often excluded under the contents section:
- Jewellery, gold and silver
- Cameras, videos or photographic equipment and accessories
- Mobile phones, computers and ancillary or associated equipment
- Pedal cycles, boats and ancillary equipment
- Cash, cheques or credit cards, business books.
There will be a policy limit together with a single article limit, sometimes with an option to specify items which fall outside these limits.
Additional contents cover
Some policies may provide cover for:
- Camping and sporting equipment
- Personal effects
- Clothing, dinghies and inflatables of a restricted size whilst they are outside the caravan, but only when the policyholder is caravanning away from home.
The contents are covered when on loan to family or friends, but hire or reward will be excluded.
Cover is provided in England, Wales, Scotland, Northern Ireland, Channel Islands and the Isle of Man.
The policy is usually extended to elsewhere in Europe for a period of, say, 180 days in any policy year.
Cover is generally offered for the time when the caravan is being transported by sea within the geographical limits.
Loss or damage is excluded when/for:
- Caused by wear and tear or loss of value
- Caused by vermin, insects, mildew, rot, fungus, domestic pets, atmospheric or weather conditions, damp, rust, corrosion, the effect of light or anything which happens gradually
- Caused by mechanical or electrical breakdown
- Caused to tyres due to use of brakes or by punctures, cuts or bursts
- Arising from the use of a solid fuel or unsecured portable oil heating appliance
- The caravan is being used as a permanent residence
- The caravan is being towed by anyone other than the policyholder, a member of the policyholder’s family or anyone travelling with the policyholder
- Obsolete or unobtainable parts - if a claim for damage results in the caravan needing new parts or accessories, which are found to be obsolete or unobtainable the policy will only pay last known list price plus a fitting charge
- Repatriation from any country outside of the United Kingdom
- Any loss arising out of the liquidation, insolvency or bankruptcy of a caravan dealer or agent.
Towing ball and bracket
Cover is provided for damage to the towing ball and bracket of the towing vehicle, if caused by the caravan. If the damage is caused by a negligent third party cover is not included.
Recovery and redelivery
If the caravan can't be towed due to loss or damage covered under the policy, the following cover is usually provided.
A reasonable cost is paid for:
- Removing the caravan to the nearest competent repairer or place of safekeeping
- Storage charges whilst awaiting repair or disposal
- Redelivery, after it has been repaired, to the policyholder’s home address or the address where it is normally kept, only for incidents that occur in the UK
- If the caravan is towable, the petrol expenses involved in towing to the nearest repairer and the return following repair.
On occasions, if the caravan is damaged abroad, import duty may be payable. This would typically be covered by the policy.
If the caravan becomes uninhabitable as a result of an incident insured under the policy, cover is provided for:
- The cost of hiring another caravan or taking alternative hotel accommodation
- If the policyholder decides to abandon the holiday, the cost of recovering the caravan and contents to the home address.
Temporary accommodation is paid on a daily rate of between £50-£100, usually with a maximum of 15 days.
Some policies may provide the above cover if the caravan is damage prior to departure and it can't be repaired or replaced prior to the planned departure date.
Legal liability - Outline of cover
The policyholder is indemnified against all sums, which they become legally liable to pay as damages in respect of:
- Bodily injury, including death or disease, to any person
- Damage to third party property
arising out of the policyholder’s ownership or use of the caravan.
Liability is normally extended to include family or friends of the policyholder who are using the caravan with the policyholder's permission but not to include hire or reward.
Limit of Liability
A minimum £2 million is usually provided arising out of any one occurrence or series of occurrences.
It is standard for insurers to pay legal costs and expenses incurred in defence of any claim made by a third party, subject to their written agreement, in addition to the limit of indemnity. However, some policies do impose a limit inclusive of costs.
Caravans being towed
Liability is excluded whilst the caravan is being towed by a motor vehicle. This cover should be provided under a motor policy. Some wordings express this exclusion as ‘whilst being towed’ whilst others adopt a wider exclusion wording stating ‘whilst attached to a mechanically propelled vehicle’.
The wider exclusion suggests the caravan needs to be detached from the vehicle and therefore not able to be towed in order for legal liability cover to be effective.
The cover for damage to the caravan itself whilst it is being towed will still be provided by the caravan policy rather than the motor policy.
- Liability to your employees
- Damage to property owned or held in trust or under the control of the policyholder.
If the policyholder or anyone staying with them in the same caravan suffers death or disablement, following an accident, whilst away on holiday and staying in the caravan, the policy will pay capital benefits.
Permanent total disablement £20,000
Loss of sight of one or two eyes £20,000
Complete loss of or loss of use of hand, arm, leg or foot £20,000
Death or injury arising from:
- Suicide or any attempted suicide.
- The influence of alcohol or drugs
- Pursuing any hazardous activity such as skiing, pot-holing, mountaineering.
Security and the associated risk of theft of or from caravans is a major concerns for insurers providing caravan insurance.
Theft of caravans is quite common and the chance of recovering a stolen caravan is generally quite low. Here are some facts and figures:
- On average, in excess of 1400 caravans are stolen each year as per the caravan club
- Average claims for stolen caravans amount to approximately £24,000
- According to the Club Care insurance only 3% of stolen caravans are recovered.
Some manufacturers now incorporate tracking devices at the time of build and systems are available that can be installed into existing caravans.
Theft check register
Some clubs operate a computerised theft register where caravan ownership details are recorded. The records can assist authorities in identifying owners in the event that a stolen caravan is recovered.
Additionally, people considering buying a caravan can check the caravan’s details free of charge through the Theftcheck register to make sure the caravan is not stolen.
All caravans manufactured since 1992 by NCC members, are recorded on the CRiS database by their unique 17 digit Vehicle Identification Number (VIN). Pre - 1992 or imported caravans can be registered with CRiS by the owner. Many insurance companies now require CRiS registration before they will issue a policy.
When purchasing a caravan a CRiS check can be carried out to:
- Confirm the correct identity of the caravan
- Reveal if the caravan is:
- Recorded as on finance
- Reported as stolen
- Recorded as an insurance write-off
- Confirm if the seller is currently recorded with CRiS as the current keeper.
MINDER was created by HPI and the UK Motorhome Industry; it is a vehicle security and asset registration system which helps protect against theft and fraud.
- All Motorhomes sold since 2001 have a:
- Unique motorhome identification number (MIN)
- Vehicle identification number (VIN)
- Vehicle registration mark (VRM)
- Hidden electronic tag
- Visible etching of the MIN number
- Permanent warning sticker.
These features help to offer a greater level of security to owners and also enable future buyers to identify the vehicle and check its history with confidence.
Loss or damage cover includes theft subject to certain exclusions:
- Loss or damage to fixtures and fittings by theft or malicious damage while the caravan has been left unattended and is not securely locked
- Theft of the caravan unless at the time of theft the caravan was secured by a wheel clamp and/or other security precautions specified by the insurer
- Damage caused by theft, malicious persons or vandals to gas bottles or generators while outside the caravan unless securely padlocked.
Some policies may also have a theft warranty which states that:
‘Whenever the caravan is left unhitched from a towing vehicle for a period exceeding 8 hours, it is immobilised or protected against theft or unlawful removal by the use of one of the following:
- a hitchlock
- wheel clamp
- heavy duty chain or immobiliser or
- an alarm system.
Failure to comply with the warranty will prevent the policyholder claiming an indemnity following the theft or attempted theft of the caravan.
The theft risk for caravans on fixed sites tends to be a lower risk than for touring caravans. This is because fixed sites often have better standards of security and may be equipped with security cameras and have permanent supervision in place.
The proposal form asks for information concerning security at the site. If it is not of a suitable standard, insurers have the following options:
- To impose a higher excess for theft
- To impose conditions/warranties about installing and setting alarms
- To refuse to insure the risk.
Storm damage also leads to a high volume of claims and, if they are based permanently on a caravan site this is likely to be an increased risk.
Caravan sites are often in vulnerable locations such as near rivers, the coast, or cliff top. Consequently, they are exposed to some of the UK's extreme weather conditions with little protection from the elements. Additionally, the caravan may be unoccupied for several weeks, reducing the opportunity for a problem to be detected.
This risk has increased significantly due to the increasing rainfall in the UK. Caravans are at risk of damage or total loss as a result of flooding.
The Department for Food and Rural Affairs reported in 2012 that 28 per cent of the UK caravan parks are at risk of flooding.
Touring caravans are particularly vulnerable since flood water can enter the caravan very quickly, as the vent boards are located in the floor.
Flood saver device
These devices are recommended by the caravan club if the caravan is of risk of flooding to a significant height.
They comprise of galvanised steel struts, enclosing fire-retardant polystyrene blocks to provide the buoyancy. They are fitted underneath the caravan. In the event of flooding, the polystyrene blocks float, keeping the unit above the surface of the water up to 11ft above the ground. As the flood subsides, the unit returns to its original position. Although not cheap they can protect the caravan during a flood.
The lightweight construction means a caravan can be easily upturned and carried away by strong winds and damaged beyond repair.
In the hurricane of 1987, 200 caravans on a site in Sussex were ‘flung into chaos’. Additionally, the 1987 hurricane occurred at night so many of the caravans were occupied at the time.
Caravan owners with fixed site caravans need to be aware that if they use a site with a poor claims record, they may find it is increasingly difficult to buy insurance.
Insurers also have to be aware of risk accumulation at any one site. Adverse weather causes a problem for insurers if they have a substantial exposure at one site. They have to manage the exposure to stay within their maximum single loss limit.
CLAIMS AND OTHER TYPES OF CARAVANS
Loss or damage
In the event of a claim following loss or damage to the caravan or its contents the policy will pay the cost of reinstatement, replacement or repair. Where relevant, deductions will be made to reflect the age of and wear and tear to items lost or damaged.
- Allow the policyholder to arrange for repairs to be carried out up to a certain limit, say, £250, without prior consultation with the insurer
- Pay for the costs incurred for disconnecting and reconnecting services, if the caravan has to be removed to carry out necessary repairs.
New for old
In the event of a total loss or where it is uneconomical to repair, insurers will pay the full replacement cost as new provided that:
- If on a fixed site, the caravan is, say, no older than 2 years from new
- If used for touring, the caravan is, say, no older than 1 year from new
- The Caravan Club's standard policy replaces with new up to 5 years old.
Some policies stipulate the sum insured must represent the total cost of replacement as new, while others will pay a maximum of the sum insured plus 10% for total losses.
There are premier policies which offer a ‘new for old’ cover until the caravan is 10 years old, which is very attractive to customers. This wording incorporates a warranty that the caravan must be serviced annually after reaching 5 years in order for the new for old cover option to remain valid.
Along with the problems of theft and weather risks, the third main source of claims generated by caravan risks is road accidents. An estimated 3,000 motor homes are involved in road accidents per year at an average cost of £7,000 per claim.
Most standard caravan policies contain exclusions for mobile homes and caravans used as permanent residences.
Insurance for these would normally be provided by a specifically designed policy, which is normally more in line with a household policy.
Contents in mobile homes are usually of higher value than in holiday caravans. Different criteria need to be considered for underwriting risks of this type.
These have to be insured under a motor policy due to the legal requirement to insure third party risks. There are specifically designed policies available on the market.
The policies are fairly flexible in terms of cover provided. Policies typically offer:
- Cover for all European journeys up to a maximum period, say, 6 months, in any one policy year
- Personal effects cover, including awnings and toilet tents, equipment and baggage, portable televisions radios and CD players
- Laid-up cover available at a discounted premium when the vehicle is not on the road.
Hiring out the caravan
When a caravan is hired out a standard policy is unlikely to cover this without specific referral. A policy will also be more limited in cover:
- Caravan - some policies may not cover it whilst it is being hired out
- Contents - may be excluded or subject to certain restrictions and/or an increased excess, when the caravan is being used by anyone other than the policyholder and family members
- Towing - most insurers, will only cover the caravan for loss or damage when being towed by the policyholder or family member. Therefore, it is likely that the policyholder will have to deliver a touring caravan to an agreed site if it is to be hired out
- Hire charges - if the policyholder is unable to hire out the caravan due to loss or damage which occurs after the bookings were made, the policy will pay for loss of hire charges. This would be subject to documentary evidence.
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