Insurance Risks when Vacationing with Family and Friends
Going on vacation is something most people look forward to with great anticipation. So thinking about what could go wrong is not high on the list of priorities, but a little advance planning could save you a lot of money and avoid problems if the unexpected should occur.
When most people think about vacation insurance they often turn their minds to lost baggage, cancellations and medical costs. In reality, there are much greater financial risks to consider when arranging your coverage.
It is normal to want to try new things while on vacation and for many people jet skiing is an innocent and fun activity. However, with many models capable of speeds of over 65 mph and especially in the hands of an inexperienced individual, it is not out of the question that an accident could occur. For example, one study reported that out of all the boating incidents in the U.S., jet ski accidents made up 23% of the total, with 45 fatalities recorded in just one year.1 A separate study revealed that of individuals involved in jet ski accidents, 29% sustained head injuries while inexperienced jet skiers accounted for 32% of all incidents.2
But jet skis are not the only hazard on the water, as a simple boat trip also can present a risk if handled incorrectly. One study revealed that for each 100,000 registered water vessels, 5.4 injuries occurred every year with the vast majority due to a lack of training or experience in sailing.
For this reason, if you plan on trying your hand at a spot of jet skiing, or any other kind of water-based activity, it is essential to have the proper coverage in place. A standard insurance policy will usually only cover physical damage, yet there are a number of other financial costs that could be incurred if an accident takes place. Liability insurance can be purchased as an add-on and should be considered as a necessity for any jet skier, while other optional extras cover potential costs such as medical expenses.
But it is not just sporting activity that requires coverage to be organized before you travel. A popular way to vacation is to rent a motor home, with many families enjoying the freedom of being able to travel around while having all the necessary amenities available. It can also be remarkably cheap, a boon in the current economic climate. However, in order to prevent any potential costs being added to the price of the vacation, getting the necessary liability coverage in place is essential. As well as being a good idea, most states prohibit the hire of RVs without proof of insurance being provided to the leasing firm.
It is possible to combine RV and boat insurance on one plan, so for those thinking they may want to jet ski, even on an inland lake, or go sailing, taking the coverage out in one go can be very cost effective. It is usually possible to get the insurance at the same time as you rent the vehicle but this can work out a more expensive option.
For those unfamiliar with RV insurance, it is vital to take a good look at the policy criteria as there are many different types of coverage. For example, some types of insurance will pay out if an incident occurs while you are driving, but if you were parked up any claim would automatically be excluded. If staying overnight in a campsite, be ready to show your insurance documents, as many places will not let you stay if you have no coverage.
There are many things that can be included in a policy, and costs such as vehicle damage, personal injury and loss of vehicle are usually incorporated. However, it is possible to add additional riders such as loss of personal possessions from the RV, as well as fire, flood and towing coverage. While the idea that you might find yourself up to your chassis in water may sound ridiculous, driving an unfamiliar vehicle around new parts of the country can increase the chances of a mishap. According to national statistics, in just one year more than 70,000 people were injured while in an RV.
Even staying in a condo during your vacation has insurance implications. The signatory on the rental form is almost always held not only responsible for the payment of the condo rental, but also held responsible for damage or mishaps, regardless of who is at fault. For a single family vacationing together, this is a lesser issue, but for friends or extended families, it may be worth considering who should be a co-signatory. In order to prevent disputes if there is any damage or problems with the signatory trying to be reimbursed, it may be a good idea to have a representative from each family sign the contract.
Another factor that should be taken into account is the likely weather at the time of year you are traveling. A dream trip to Disneyland could turn into dollars down the drain if a hurricane hits and the park is closed down for the duration of your visit. Similarly, skiers pray for good snow when they hit the slopes, but an avalanche warning will close down the resort, leaving all outdoors out of bounds. There are special riders or policies that can cover these kinds of specialized risks, and while not enjoying the vacation you had hoped for will naturally be disappointing, knowing that you are not out of pocket will help offset that.
Some types of insurance which you may already have, such as homeowners or auto, may provide some of the necessary coverage you need, so it is worth checking the fine print on your policies first. Even if it doesn’t include all the coverage you need, adding extra benefits to an existing policy can often work out more cost-effective than taking out a separate policy. Before deciding whether the coverage you already have in place is sufficient, you should consider the likely risks you will be facing. For example, your personal possessions may be adequately protected on some types of vacation but not on others. Unusual losses or damage such as those inflicted by animals are unlikely to be covered on a standard homeowners policy. Similarly, most homeowners policies provide liability insurance but will exclude claims that arise from pursuits such as hiring a boat.
Thinking about the worst things that could happen before your vacation even begins can seem like a depressing way to start, but once in place, you can enjoy your break safe in the knowledge that whatever happens your financial risks are covered.
- U.S. Coast Guard, Accident Statistics, 2010
- The Franklin Institute, The Human Brain, 2011
