Taking Insurance on Vacation- Homeowners & Auto Policies
I am taking my family on vacation this summer. We may travel to a foreign country. Will I need any special insurance to cover my personal property and liability?
Vacations -whether taken in the summer or the winter -can pose unusual risks you don’t encounter every day, especially when you travel out of the country.
If your fishing skills are a little rusty and you injure a fellow fisherman, or if one of the kids starts a fire in a hotel room, will your homeowners insurance respond and pay the claim or defend a lawsuit? What if you participate in different recreational activities while on vacation, like golfing, boating, jet skiing, biking, snowmobiling, or hang-gliding? Will you be renting a golf cart or snowmobile, or maybe a moped, 3-wheeler, and 4-wheeler? All of these activities can be fun, but they can also be dangerous. Will one of your policies respond if you hurt someone or damage property belonging to others while participating in these activities?
One of your current policies may provide coverage for some of these activities, but unfortunately, there is no policy that will provide coverage for all of these activities.
Automobile Risks. The typical auto policy covers auto accidents and losses in any U.S. state, territory or possession, and Puerto Rico and Canada. In fact, the liability limits under your auto policy may actually change as you cross state lines or enter Canada, in order to meet financial responsibility or compulsory insurance laws requiring certain minimum limits and coverages for automobiles operated in that jurisdiction.
It’s a different story, however, if you travel to Mexico or a foreign country other than Canada or Puerto Rico. Your policy does not provide adequate coverage for accidents in those countries. (Your policy may extend some coverage to accidents in Mexico, but the coverage is very limited and you shouldn’t count on it providing adequate protection for your family.) If you don’t plan to rent a car while vacationing in a foreign country, but may be using some form of public transportation such as buses and taxis, consider buying special trip insurance to cover medical and other expenses that may result from an accident -see Trip Insurance below.
If you rent a car while vacationing in the U.S., your auto policy provides limited coverage for damage to the rent car and other claims arising out of the operation of the rent car. However, we recommend you purchase the damage waiver offered by the rental company for complete protection. (We have a separate report available on rental car exposures. Please ask and we’ll send it to you.)
If you rent a car in a foreign country, you will definitely need special coverage. Ask the rental company what they offer, and see Trip Insurance below.
Recreational Vehicle and Watercraft Risks. If you rent any kind of recreational vehicle or watercraft on your vacation, your auto or homeowners policy may not cover damage to the rented vehicle or watercraft, or injury to others or damage to property owned by others. To be safe, we recommend you ask the rental company if a damage waiver and liability insurance is available for an additional charge.
Personal Property. Your homeowners policy covers property you take on vacation anywhere in the world, but the amount of coverage on property away from home may be lower than the limit shown on your policy. In addition, most policies won’t cover unusual types of losses you might encounter on vacation. For example, there may be no coverage if a monkey at the wild animal park or a bear at the campground shreds luggage or other personal belongings. Also keep in mind the policy may contain very small limits of coverage for money and jewelry, so take special precautions if you carry more cash and jewelry on vacation than you would usually carry at home.
Your policy covers theft, but you must report the theft to local authorities. Obtain a copy of the police report before leaving the area, especially if the loss occurs in a foreign country.
Liability Risks. The liability section of your homeowners policy applies to accidents anywhere in the world, but all policies contain exclusions related to certain activities like the recreational vehicle and watercraft activities mentioned above. For the typical liability risks, however, like injuring someone while fishing, or setting the hotel room on fire, your homeowners policy will pay claims or defend lawsuits in the U.S. or any foreign country. If you don’t already have a personal umbrella policy, ask us about this. These policies provide high limits of liability over and above your auto and homeowners policies, and may also cover unusual exposures not covered by those policies.
Trip Insurance. Trip Insurance covers canceled or interrupted trips, as well as emergency medical coverage and rental car coverage for U.S. citizens traveling abroad. It typically comes in a package that covers these and other exposures, although it can be purchased to cover a single exposure. Package policies are the most common and once were sold primarily by travel agents. However, with growing numbers of travelers making travel plans themselves on the Internet, web sites offering Trip Insurance are flourishing.
Vacation Time is Insurance Check-Up Time
Contact our agency for a review of your policies before you go on vacation. This is an excellent time to consider purchasing those higher limits and broader coverages we’ve been telling you about.
This article was prepared and made available to your agent by the Independent Insurance Agents of Texas, which is solely responsible for its content. Please read your insurance policy. If there is any conflict between the information in this article and the actual terms and conditions of your policy, the terms and conditions of your policy will apply. The Independent Insurance Agents of Texas is a non-profit association of more than 1,800 insurance agencies in Texas, dedicated to helping its members succeed, in part by providing technical resources that explain insurance policies sold to their customers.
