When Is RV Insurance Required?

RV Requirements

Do You Need RV Insurance?
Getty Images/Brad Wilson

Owning an RV can be a lot of fun and provide a novel way to travel across the country, but it is also a large investment and should be treated as such. In addition to budgeting for maintenance and financing costs, when planning for a new set of house-toting wheels, it’s important to know whether or not RV insurance will be required for your recreational vehicle. A lot of factors come into consideration, and laws can vary by state, making the process rather confusing at times.

Below are guidelines that will make the process of determining whether or not you are legally obligated to have insurance a little bit easier. Remember, though: just because you’re not legally obligated doesn’t mean you shouldn’t purchase it! Always talk to your insurance agent or other qualified professional before deciding whether or not RV insurance is right for you.

Times RV Insurance Is Generally Required

At minimum, the same amount of liability coverage required for a car is required by an RV in most states. We will discuss special cases in the next section, but, you will definitely need a separate RV insurance policy if:

• Your RV is a motorhome (Class A or B)

• You do not own your RV outright (i.e., you took out a loan to finance the purchase)

• Your RV is a rental vehicle

Motorhomes are required by law to have liability insurance while being driven on the road in most states. Full coverage can be optional based on whether you have the vehicle financed, but just because full coverage is optional does not mean you should necessarily opt-out.

Determine the value of your RV versus the likelihood of a loss to decide if you can self-insure your motor home’s physical damage risk. If you live in your vehicle full-time, it is especially important to consider additional insurance coverage.

Financed RVs are generally required to carry full coverage because lenders want reimbursement on their loan in case of a loss.

If you do not purchase full coverage, your lender could take out an insurance policy on the vehicle and send you the bill. Lender-purchased insurance typically comes with much higher premiums and no liability, so taking responsibility for your investment is a smart decision!

Rental RVs are your responsibility while in your possession. It is important to make sure you have insurance coverage on the RV. Check with your auto insurance carrier to see if coverage extends to an RV you are renting. RV rental dealers usually either automatically include insurance in the price of the rental or have short-term policies available for purchase.

Times RV Insurance is Optional

• Your RV is only towable not drivable (class C)

• You own your RV outright with no financing and live in a state where RV insurance is not required by law

Towable RVs include fifth wheels, pop-ups, and travel trailers. Liability insurance is generally extended from your car insurance policy to your RV when you are towing it. For instance, if your camper somehow comes unhitched from your truck and damages some property, your auto insurance liability will cover the costs. Because liability is covered under your car insurance, the state does not require insurance on towable RVs.

Loan-free RV means you own the camper outright without any financing. RV insurance is only optional when the RV is loan free and is towable only -- it is not optional for motorhomes unless you live in a state that doesn’t require RV insurance. If you purchase a new travel trailer for $10,000 cash, insurance is optional; however, you would probably still want to carry full coverage on it. A total loss, such as fire or theft, would be devastating to most people without insurance to protect the investment and reimburse you for your losses. Determine the value of your RV versus the likelihood of a loss to before you decide to self-insure your travel trailer’s physical damage risk and see if it’s really worth it.

Whether RV insurance is optional or required, be aware of the pitfalls of going without RV insurance.

Lots of RV owners leave their RVs parked out in the open yard, leaving them susceptible to storm damage, vandalism and possible theft. If your RV holds a great deal of value, make sure to purchase full coverage RV insurance to protect against a potential loss.