Caravan Insurance - Is It Really Nesessary

[bertieboy1]

This year we bought a new caravan,with a number of things going on at the same time I forgot to insure it.This made me think back to when we bought our first caravan - it was never insured all the ten years we had it. ( We didn't need it)
I thought more about caravan insurance and have come to the following conclusions -
First of all I recognise there will always be someone,somewhere making an insurance claim.
1. Statistically you don't need caravan insurance (If the insurance companies received enough claims they would go out of business)
2. If the insurance companies are willing to pay out a lot of money for a claim against the premium you pay then they are certain you won't make a claim.
3. Legally caravan insurance is not required.
4. This all comes down to "peace of mind" and the insurance companies know this.
- Just a thought from someone who has never made an insurance claim - for anything.

 

[Raywood]

Sorry but the post just does not stand up to scrutiny.
1. The basis of insurance is that a lot of people pay into a pool so that when one of them has a loss they can take the cost from the pool. The premium is based on the claims paid out in the previous year plus an allowance for inflation and any up or down trends. The premiums are therefore set on a basis that should prevent the companies going out of business.
2.The companies pay out most of the premiums, the profit margin is usually less than 5%. The level of competition is very high so there is no way of exploiting the customers, even if you think otherwise, if you charge too much the customers go elsewhere.
3. There is no legal requirement for insurance but the C&CC say the average payment is £14,000, seems high to me though and your caravan may not be worth that. The real potentially crippling risk is if you seriously injure someone and you have a claim running into tens of thousands against you.
4. Yes it does mean peace of mind and protection from serious loss if the worst happens. I believe that more than 1,000 caravans a year are stolen, I make that about one in thirty so the odds on it being stolen are quite high.

 

[Surfer]

If for example your caravan caught fire on a site and damaged other caravans, would you be able to pay if people sued you for damages? There are other instances. Also are you happy to chuck away money as you can get the same feeling walking down the High Street and giving every one money. Recently on thsi forum there have been posts about stolen caravans that weren't insured and people lost everything!
Many storage facilities and caravan sites state that a condition of entry is that the caravan is insured although they never check but it gives them an escape clause.
Our first caravan bought here in 2004 was only valued at £1500 and insurance was £45 for the year insured with the CC at market value.

 

[TonyG]

good posting,
what is the difference between insuring your house, car, caravan, health and life.... foolish not to take out insurance...

Sorry but the post just does not stand up to scrutiny.
1. The basis of insurance is that a lot of people pay into a pool so that when one of them has a loss they can take the cost from the pool. The premium is based on the claims paid out in the previous year plus an allowance for inflation and any up or down trends. The premiums are therefore set on a basis that should prevent the companies going out of business.
2.The companies pay out most of the premiums, the profit margin is usually less than 5%. The level of competition is very high so there is no way of exploiting the customers, even if you think otherwise, if you charge too much the customers go elsewhere.
3. There is no legal requirement for insurance but the C&CC say the average payment is £14,000, seems high to me though and your caravan may not be worth that. The real potentially crippling risk is if you seriously injure someone and you have a claim running into tens of thousands against you.
4. Yes it does mean peace of mind and protection from serious loss if the worst happens. I believe that more than 1,000 caravans a year are stolen, I make that about one in thirty so the odds on it being stolen are quite high.

 

[Dustydog]

Bertie Boy
You have to ask yourself these two questions.

Are you prepared to deposit the cash value of your new caravan in a bank account and leave it there in case yours get damaged or stolen?
On Surfer's point are you willing to lose everything, home included in the event your unhitched caravan causes third party bodily injury or property damage?

 

[Martin24]

I've never had an accident!! But then I don't use my rear view mirror!! Luckily it seems the majority of us do have caravan insurance and for all of the valid points already listed. I for one can't afford to pay out thousands of pounds in third party claims, nor could I easily afford to replace the caravan, mover, awning, and all the other kit that we all amass over a number of years! Indeed every new bit of kit is not only receipted but also photographed before going to the van. We also evaluate our cover each year at renewal to ensure we still have appropriate cover.

 

[bertieboy1]

I'm afraid everyone has misread this post - I haven't said I don't insure anything,all I'm saying is that insurance is a gamble,a gamble that everyone as individuals take and insurance companies take.
The insurance companies gamble that you won't make a claim on them for the premium you pay and their statistics will tell them,based on the info you provide whether you are a good gamble or not.
What I said is correct and does stand up to scrutiny - "Statistically the odds are in your favour" not to have an accident otherwise insurance companies would not exist

 

[RogerL]

"Statistically the odds are in your favour"

That applies to all insurance - after all, the provider would have to add admin/operating costs to claims costs, as well as making a profit. It comes down to whether you can afford to gamble on the odds - like real gambling, it's foolhardy to say the least if you can't afford to stand the potential losses.
At least caravan insurance cost is reasonable, compared to the potential losses - unlike product breakdown insurance which is very expensive, compared to the value of the product and probability of breakdown.

 

[Raywood]

Statistically in any given year you should not have a claim. What the insurers do is try to work out the total cost of next years claims and divide it by the number of policies to get a case premium. You then adjust for risk add operating costs and a profit margin and that is the premium. The premium is based on a proportion of policyholders having a claim and what the total of all claime should be. There is an element of risk for the insurer who has to carryu a reserve over and above the premiums to cover for claims exceeding the anticipated claims total.

I'm afraid everyone has misread this post - I haven't said I don't insure anything,all I'm saying is that insurance is a gamble,a gamble that everyone as individuals take and insurance companies take.
The insurance companies gamble that you won't make a claim on them for the premium you pay and their statistics will tell them,based on the info you provide whether you are a good gamble or not.
What I said is correct and does stand up to scrutiny - "Statistically the odds are in your favour" not to have an accident otherwise insurance companies would not exist

 

[ProfJohnL]

Oh Bertie!

You write:-

What I said is correct and does stand up to scrutiny

That's a dangerous statement to make.

Technically you haven't 'said' anything have you? you have made a series of written statements, and the content of this statement invites close scrutiny of what you have written!

I'm afraid everyone has misread this post - I haven't said I don't insure anything,.....

Having re-read all the posts, I don't see that anyone is suggesting you don't insure anything, so it looks like you have misread everyone else's posts!

There is no legal requirement for caravanners to take out insurance for their caravans, but that does expose then to the risk if a loss is suffered.

It is a risk/benefit assessment that each owner should make, but in most cases the owners see the relatively small cost of the insurance premium to be a sensible expenditure to protect their investment and to provide peace of mind.

 

[PaulT]

Isn't this thread in the wrong section?
I live in France where it is compulsory to have third party insurance for towing a caravan - it adds about 100€ to the car insurance. Other than that no insurance is needed - is other insurance necessary? In my view, yes.You can take all the security precautions possible but what you can't safeguard against are natural events. A friend out here had his 'van badly dented by hail a few years ago. He wasn't insured so got nothing. He recently changed his 'van - a month after taking delivery, we had another hail storm. His new 'van is now dented but he didn't learn by his previous experience and didn't bother to take out insurance.
Even in the UK I've heard of caravans being damaged by the weather so surely it makes sense to insure them.

 

[RogerL]

It's compulsory throughout Europe to have third party insurance for towing a caravan - but in the UK that's provided free of charge by the car insurer - although one or two insurers have started making a small charge.

 

[Parksy]

...........Even in the UK I've heard of caravans being damaged by the weather so surely it makes sense to insure them.

This is a long story but have a read if you wonder whether caravan insurance is really necessary............
We saved hard and bought our first ever brand new touring caravan which we collected in March 2007 after owning a succession of older used tourers previously.
Of course we insured it before we collected it from the dealers, new for old, so the sum insured was over £12,000 plus the price of the accessories. (awning, tv, crockery etc
In July 2007 our caravan was pitched on campsite right next to the River Avon near to Pershore in Worcestershire.
There had been heavy rain during that week and we left the caravan for the day for a day trip to Bristol.
Unfortunately the Avon burst it's banks and some roads had flooded including the M5, so we were very late returning. The police wouldn't allow us to go through to the campsite because of the state of the roads and country lanes, although the site itself hadn't flooded at this stage, and it had never flooded previously.
We had no choice but to return home, meanwhile due to recently erected flood defences along parts of the River Severn the flood waters were dispersed along the Avon (which joins the Seven at nearby Tewkesbury). Our campsite flooded overnight, and our pride and joy was flooded with a toxic mixture or river water and sewage to a depth of 4".
It was some days before we could access the site to assess the damage, it was heartbreaking to see our new caravan, just over three months old, with a layer of evil smelling sludge all over the once pristine carpets. Some of the tourers on that site had flooded to the level of the windows, ours was on slightly higher ground but I couldn't see how we would ever clean the caravan up.
We contacted the C&CC Club Care insurance and we were informed that the loss adjuster would be with us in a day or so. The insurance loss adjuster phoned us and we met him on the site, he inspected our new caravan and regretfully told us there and then that it was a total loss, a 'write off '.
The loss adjuster arranged for the caravan to be collected and within the next week we'd been invited to submit a list of accessories that we'd lost and to send evidence of exactly how much the caravan had cost.
The insurers made us a generous offer for our accessories, and asked us to choose our new caravan where they would pay the dealers the sum of money that we'd insured. This all took place within a couple of weeks of the flood so although it was a very sad time for us, the episode was made much less traumatic because we'd chosen a good reputable insurer (not the cheapest, but the best) and our claim was settled with the minimum of fuss.
I felt sorry for those on the site who hadn't been insured, one that I know of spent months trying to clean his tourer but he never got rid of the smell and he had to sell it at a significant loss.
Interestingly our premium didn't rise significantly after this unhappy event, even though we upgraded to our present twin axle model, which of course is still insured with the C&CC.

 

[kie68]

Like you say piece of mind,
I was taking my caravan off my drive as we were going away for Easter. My driveway has an incline and I drive the caravan on and off with my motormover as the A frame is towards the house for easy of loading and security. Whilst taking the caravan off the drive the motormover sprang off (I hadn't locked it on properly) and the caravan rolled down the drive and the rear panel smashed into some iron railings.The panel cracked on both sides.The insurance company was great ,had the caravan repair good as new....cost of repair £3000. I pay £250 a year for my insurance.
Don't forget you are insuring for total loss, what if ,heaven forbid, your caravan caught fire and burnt to the ground or was stolen.How much would it cost for you to replace everything you have in there...clothes,bedding,plates,pans,cutlery,waste master,aquaroll,gas bottles,let alone the caravan itself
Give me piece of mind anyday

 

[intransient1]

Then there is the other modern problem, the hit and run driver.
While we went to the loo at a motorway services we parked our outfit in the caravan parking area.
While we were gone some person caught the front nearside of the van, the result was just short off £1200 to repair.
If I did not have insurance it would be a long time before I could get it repaired, instead of just waiting for parts from the manufacturer.

 

[Surfer]

Yesterday we spoke with our friends who normally keep their caravan at Croft park where they had that devastating fire which destroyed many caravans. They had taken theirs home for servicing. They were telling us that many owners never had their caravans insured. Their site next door neighbour lost his £22,000 caravan which was not insured. I cannot understand how someone can spend money on a caravan and then not insure it! Obviously they will be trying to claim against the park which will result in escalated costs for owners who insured their caravans.

 

[ProfJohnL]

Yesterday we spoke with our friends who normally keep their caravan at Croft park where they had that devastating fire which destroyed many caravans. They had taken theirs home for servicing. They were telling us that many owners never had their caravans insured. Their site next door neighbour lost his £22,000 caravan which was not insured. I cannot understand how someone can spend money on a caravan and then not insure it! Obviously they will be trying to claim against the park which will result in escalated costs for owners who insured their caravans.

Can you explain your reasoning that assumes uninsured caravan owners claiming will increase the parks charges? Why do you assume insured caravan owners losses will not increase the parks operating costs?

 

[Dustydog]

Prof

Uninsured caravan owners claiming successfully against the site owner will without doubt increase the site owners annual premium which no doubt will be reflected in their site charges.

Surfers last assumption is probably true in so far as any insurer paying out on an insured loss will seek to increase their premium rating depending how their annual loss ratio pans out. This aspect will not of course directly affect the site owners own insurance costs.

The chances of the uninsured owners recovering any monies looks extremely unlikely. They will have to prove the fire was caused by the site owners negligence.

According to the official and unofficial thoughts on causation an errant Chinese style candle paper lantern landed on the site and set fire to one of the caravans. The rest is history.

The lesson very simply is don't moan if you choose not to insure a £22 k caravan.

 

[Raywood]

To claim against the owners insurance they would have to show the owners were negligent or that some failure on their part caused the loss. As I understand it the fire was not caused by any fault on the part of the owners so on that basis any claim against them will fail.
Ray

Yesterday we spoke with our friends who normally keep their caravan at Croft park where they had that devastating fire which destroyed many caravans. They had taken theirs home for servicing. They were telling us that many owners never had their caravans insured. Their site next door neighbour lost his £22,000 caravan which was not insured. I cannot understand how someone can spend money on a caravan and then not insure it! Obviously they will be trying to claim against the park which will result in escalated costs for owners who insured their caravans.
[/quote]

 

[seth1]

But to answer the question there is no law that says you need insurance to use a caravan on the highway,so no its not nessecary.

 

[Surfer]

To claim against the owners insurance they would have to show the owners were negligent or that some failure on their part caused the loss. As I understand it the fire was not caused by any fault on the part of the owners so on that basis any claim against them will fail.
Ray

Yesterday we spoke with our friends who normally keep their caravan at Croft park where they had that devastating fire which destroyed many caravans. They had taken theirs home for servicing. They were telling us that many owners never had their caravans insured. Their site next door neighbour lost his £22,000 caravan which was not insured. I cannot understand how someone can spend money on a caravan and then not insure it! Obviously they will be trying to claim against the park which will result in escalated costs for owners who insured their caravans.

[/quote]

Not quite as the owners allowed the party to take place on their property and probably charged the people for using the clubhouse which is next door to the storage area. They think that there is a possibility that a Chinese lantern set a caravan cover on fire as on its own unlikely to have set a caravan on fire by landing on the roof of a caravan. This is an assumption and not fact. However you are correct that people will look at the owners for not safeguarding their property who in turn will pass it onto the insurers. Hopefully they have a good policy in place.

 

[Dustydog]

But to answer the question there is no law that says you need insurance to use a caravan on the highway,so no its not nessecary.

Hi Seth
Not quite right.
See this earlier one from Roger L:-

It's compulsory throughout Europe to have third party insurance for towing a caravan - but in the UK that's provided free of charge by the car insurer - although one or two insurers have started making a small charge.

You are correct insofar as the caravan doesn't have to be insured but whilst it is attached to the towing vehicle and in use on the highway then it must have the Statutory Third Party Liability cover, 99.99% of the time given by the motor insurer.
As we discovered a couple of years ago do tell your Insurers you are towing a caravan or they may refuse a claim.

 

[Raywood]

If the owners did allow the chinese lanterns to be let off from their property and on the balance of probabilities (absolute proof is not required) then there is a very good chance that a claim against them will succeed. I think the insurers of the cxaravans that were insured will be looking closely at this and will make a claim if they have sufficient evidence. If the site insurers pay the other insurers no doubt the owners of any uninsured caravans will asik to be paid on the same basis. There is as far as I know no test case on chinese lanterns causing a fire but I think it is very probable that any one sending a lighted lantern into the night sky will be held to know that this could cause a fire and will be liablefor any damage they cause. This could also mean a claim against the people who actualy released the lanterns, so be very careful if you are thinking you might set these off.
If as I believe about 80 caravans were damaged, if you allow an average of £10,000 for each one and its contents and claims for loss of use then you are looking at a claim of about £800,000 that with costs could easily exceed £1,000,000.

 

[ProfJohnL]

Hello Dusty,

I'm not about to dispute the causes or otherwise of this fire, as I don't have any facts, besides which, that would spoil the thrust of my point!

Let us suppose the site owners are confirmed as liable. Then any claims will be passed to their insurers. Uninsured owners will of course lodge their claims. Insured owners have the option to either claim direct from the sites or through their own insurers, But the caravanners insurers will be looking to recover their costs, and would pass the claim onto the sites insurer notably plus their admin charges (which I'll bet run into £100'S not £10's.

So Its likely that a claim lodged with a caravan owners insure will actually cost more, than an claim lodged direct by an uninsured owner.

Either way, the sites insurers will review the sites risk and adjust its premiums accordingly. So on balance I don't thing the uninsured owners will disproportionately affect the sites costs.

I am not advocating declining insurance, as it has other important benefits for owners.

 

[Dustydog]

Hi John

We are all singing from the same hymn sheet.

The ones with the hardest and sadest problem are the caravan owners who chose not to insure. But then one must assume they were prepared to take the risk in the first place. As Surfer says it is amazing there are still people out there who think "it will never happen to them".