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Caravan Insurance – What Cover Are You Getting For Your Money?

When searching for caravan insurance it is important to know what cover you are getting, for example insurers cover your caravan for one of three options, New for Old, Agreed Value or Market Value.

There is often confusion as to which cover is most suitable for you and here we try and explain the differences, as in the event of a claim this can be a big difference.

What Is New for Old Cover?

New for Old is a term used mainly in household insurance and basically means that if you suffer a total loss to the caravan (i.e the caravan is written off) within a set timescale from the date that the caravan was made, the insurer will replace the van with one of the same make and model.

One of the general stipulations of this cover is that you would have an original purchase receipt, and this would prove the value of the caravan for your insurer. The insurance company specify a timescale for this cover, typically 3 or 5 years but in certain cases this can be more. It is important to remember that the cover runs from the date that the caravan was manufactured and not when purchased by you.

Another thing to consider is that some insurers cover you only if you are the first owner of the caravan, whilst others cover New for Old regardless of the number of previous owners as long as it is within the specified timescales.

It is also very important to update the value of the caravan every year to the correct replacement value to ensure you have the correct cover.

What Is Agreed Value?

The second typical level of cover in caravan insurance is Agreed Value which means that if your caravan suffers a total loss within the specified time period the insurance company will pay the purchase price paid by you. This cover generally is for if you have not been the only owner and many insurance companies do not offer this cover as it leads to confusion as to the final value of the caravan.

The insurance companies’ level of cover will not exceed the purchase price, which must be provided by a caravan dealer, and if the caravan is bought privately then a dealers’ valuation is then sought. This cover is fast dying out in the industry as it can cause disputes on the valuations. These insurers normally offer New for Old or Market Value, which is the third level of cover.

What Is Market Value Cover?

The third level of cover is Market Value which as the adverts say, “it does exactly what it says on the tin” and offers your basic cover of payment to the amount of the current market value of the caravan in the event of a write off. This cover is generally if the caravan is not eligible for New for Old or Agreed Value, though as mentioned most insurers have moved away from the latter. The most common way of determining the market value of the caravan is to use the Glass’s Guide to Caravan Values which is issued every few months, at the time of the loss, less a deduction to reflect the condition prior to the accident.

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