Just like a car, your RV requires specific insurance coverage to operate legally on the road. But the bigger the rig, the more expensive the repairs. If you’ve been considering buying more extensive protections for your RV, you might wonder if it makes sense to have both an extended warranty and RV insurance.
What’s Legally Required?
While extended warranties are considered optional, all states require drivers to have a minimum liability insurance policy to operate an RV on the road legally— this protects you in an accident involving others where you’re at fault.
Beyond basic liability insurance, all states except New Hampshire also require bodily insurance coverage, which pays for medical costs if someone in your RV or another vehicle is injured, no matter who is at fault. Some states also require uninsured motorist coverage to protect against collisions with people who don’t have insurance.
Other types of RV insurance, like vacation coverage or emergency roadside assistance policies, are not legally required but can provide peace of mind should an unexpected event occur. Check with your insurance provider or state Department of Motor Vehicles to determine the appropriate coverage in your state.
RV Insurance vs. Extended Warranty: What is the Difference?
The biggest difference between RV insurance and an extended warranty is that the warranty is not required by law. Still, the added protections could help finance major expenses not otherwise covered by your insurance policy. The second major difference is what they cover. Insurance covers damage caused by accidents, weather, or physical damage. Warranties cover mechanical failures and general wear and tear.
You can purchase an RV insurance policy from your auto or home insurance provider, but you’ll need to contact an RV extended warranty company (usually an online company) to buy a warranty. It’s important to research these companies to ensure they offer a fair coverage price. Read customer reviews and speak with a qualified representative to ensure you understand your coverage and how to file a claim.
What Does an Extended RV Warranty Cover?
While your RV’s manufacturer might offer a limited warranty, you can also purchase an extended warranty protection policy from a third-party company. Sometimes referred to as an RV extended service contract, these warranties cover repairs and replacements related to mechanical failure (think: slide-out mechanisms, waste systems, and appliances). Policies, and their coverage, differ by company, but the most common types of RV extended warranty policies include:
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Exclusionary RV Extended Warranty: The most extensive coverage, exclusionary policies make understanding coverage simple by “excluding” some things and covering others. The most common exclusionary policies don’t cover weather, natural disasters, automobile collisions, aesthetic repairs (like paint or carpeting), and damage caused by vandalism. On the other hand, these policies will usually cover major mechanical failures and major mechanical components, like refrigerators or generators. Be cautious of exclusionary policies that do not cover these major systems since they are the most costly to repair.
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Listed Component Extended Warranty: Sometimes called a comprehensive policy, listed component warranties are the opposite of exclusionary policies. Instead of listing what is not covered, this policy lists only what is covered. These policies can vary, so look for one that includes powertrain coverage (engine, transmission, and front and rear drive axle assembly), as well as air conditioning, brakes, electrical, fuel delivery, gas or propane, generator or auxiliary power, heating and cooling, refrigerator, steering, water heater, waste and freshwater systems, and power step.
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Powertrain Only Coverage: Because powertrain failures are the most expensive to repair, this type of policy provides the most essential, basic coverage. The powertrain includes the transmission, engine, and drive axle. These policies are minimal, but they’re also the most affordable.
What Does RV Insurance Cover?
Depending on the type of insurance you purchase, RV insurance can cover liability, collision, and medical costs. You’ll need to buy liability coverage, at least, which covers property damage costs and bodily injury during accidents.
Consider how much you use your RV to determine the appropriate coverage. Full-time RV-er’s might opt for roadside assistance, towing and labor, or other more extensive policies that address common hurdles. Newer rigs might benefit from replacement coverage, which can cover totaled or stolen vehicles, depending on the policy.
Talk to an experienced insurance agent to find out what RV insurance policy is right for you.
Do You Need Both RV Insurance and an RV Extended Warranty?
Legally, you only need an RV insurance policy that meets your state’s requirements to operate an RV. Extended warranties are optional, but you might consider purchasing both to ensure you protect all aspects of RV life. Some studies show that 30% of RVs need a major mechanical repair within two years (that number rises to 80% by year five), so how much protection you choose depends on your risk tolerance. RV repairs aren’t cheap — transmission repairs can easily exceed $10,000.
You may not be eligible for an extended warranty if you have an older RV or one with more than 125,000 miles. In that case, it is smart to save away enough money to pay for these mechanical repairs when they happen. Remember, repairing an RV is much more expensive than an automobile because it requires specialized parts and expertise. Keep an emergency repair fund in an interest-bearing account so you’ll be prepared to keep your RV roadworthy.