Buyers' Advice: Static Caravan & Lodge Insurance
A great number of our members choose to insure via alternative providers, and we’re often asked to comment about things like price and policy coverage. We’ve put together this article to highlight some frequently asked questions and some key considerations to make when you’re choosing and insurance policy.
Our friendly, experienced team are always just a phone call away if you’ve got any questions…
Do I need to insure my static holiday home?
Although there is no legal requirement to insure your holiday home, 99.9% of the time it is a requirement made by your caravan park which they are entitled to do. Insuring your caravan is extremely important.
There are some key elements to static holiday caravan insurance which it is crucial to understand so that you are able to obtain a policy which not only meets your needs, but also meets the stipulations of your park and all at a competitive price!
Something to bear in mind about insurance is that cheaper doesn’t always mean better. Although many of us purchase insurance based on price, the amount of coverage is often more limited, it is important that you ensure you have identified what your insurance requirements are and to choose a policy that provides the cover you need.
Here are some key points to consider when looking for an insurance policy…
Holiday Home Vs Park Home Insurance
Back when NACO introduced a policy to our members there were only a handful of companies across the entire UK that offered caravan insurance, however today there are great many more and making your choice can be overwhelming.
The first thing to identify is what type of policy you require. Basically, there are 3 different types of insurance you are likely to come across:
- Park Home Insurance & Leisure Lodge Insurance - These are types of policy that are essentially household wordings. They are based on the understanding that you are using your caravan/lodge as your main residence. Because of this –conditions regarding occupancy come into play. For example, most residential wordings/policies will make exclusions when the unit is unoccupied (theft and malicious damage are usually effected in this way).
- Holiday Home Insurance – Typically, this is the type of policy our members will be looking for, a policy to cover you for holiday usage whilst at the holiday home as well as providing coverage while you are not.
New for Old (Reinstatement) or Market Value (Indemnity)
These are the two main categories of insurance for static caravan holiday homes. You will need to identify which level of cover you require.
- New for Old (Reinstatement) – This is the cost of replacing your holiday home with its brand new equivalent. In the event that you lose your caravan altogether you must have insured for the full amount of replacing your older unit for that of a brand new model, hence the NEW for OLD!
- Market Value (Indemnity) – This is the current value of your holiday home and should be sufficient to replace you with an equivalent age and type of unit in the event that it is lost altogether.
Clearance & Re-Siting
This is in relation to the costs attributed to debris removal/disposal, re-instatement of the pitch, disconnection and reconnection of services, delivery and re-siting.
With some policies you will be asked to provide a figure for this, if unsure how much to include – you should refer to your park for their guidance as it can range from £1,500 to £5,000. Cost will be dependent on various items such as extent of damage caused, delivery requirements, the need for a crane – the list goes on!
However, it is important to note that some policies include an allowance for this provision as an extension to cover – at no additional cost. It’s vitally important that you have included siting and debris removal to ensure you are adequately insured!
This essentially is what’s covered & what’s not. The levels of cover fluctuate from one policy to the next although at a quick glance they can look much the same. Here are some of the typical variants we see here at NACO:
- Draining-down & frost damage – This is probably the most common claim for caravan insurers and ALL will make clear stipulations about how and when your holiday home should be prepared for the winter period.
- Identify the dates you need to arrange ‘winterisation’ (draining your unit down and up again in the spring) as these dates often do not coincide with your parks open and closed seasons.
- Identify if your ‘winterisation’ is to be done professionally or whether you can undertake the job yourself.
- Unoccupancy – policies will state what period they consider ‘unoccupied’, you will note that different policies will make certain exclusions when the unit is unoccupied (Draining-down and frost damage are just one of the things effected in this way).
- Anchorage –Some policies insist that your unit is secured to the ground in the idea that it will minimise the risk movement/damage during storms.
Also note if perils such as flood and accidental damage are included as standard, or how about vermin damage or cover for computers? – These can be common exclusions but are common claims so BE SURE TO CHECK - you shouldn’t compromise on the cover you need!
Public Liability Cover
Liability cover is really important and it’s generally included as standard. Public liability cover provides you with protection in the event that you are held responsible by a third party for loss, damage or injury at the park. For example – your neighbour slips on your decking and sustains an injury. Following this they take up a claim against you for their losses. The public liability or ‘legal liability’ as it’s sometimes called, kicks in and insurers would appoint solicitors to handle the matter on your behalf.
Given the ‘no win – no fee’ culture that exists in the UK it’s especially important nowadays. Look for a minimum of £2,000,000.
Insurance Administration Fees
This is a charge made by some parks to verify your insurance documentation and cover. This is something that should be fully detailed within your pitch licence agreement, however if it is not please refer to NACO’s Insurance Administration Fee Guidance Sheet for more information.
Why does my caravan insurance cost more than my house insurance?
There are many reasons for this but essentially a static caravan is considered to be at a higher risk of claim than your house, the higher the risk of the items to be insured – the higher the insurance premium.
For example: Your house is a permanent structure where you will be for the most part of your time and will have adequate security in place - other than accidental damage the risk for a claim is generally minimal.
A holiday home is considered to be a non-permanent structure in a position where there is no necessity to secure it to the ground. Quite often caravans are positioned in areas that can be more susceptible to the elements like high-winds and flooding. Couple this with the fact that there are many people that come and go at a holiday park which in turn gives a greater risk to things like theft and vandalism, all of these possibilities equal higher risk which equals higher insurance premiums.
National Association of Caravan Owners