It's Vacation Time!

School is out. Let the fun begin! For many, summer is the primary time of year to pack up the family and hit the open road for sandy beaches or cool mountain breezes. It is around this time of year that we start to get several common questions surrounding vacation and insurance.

Do I need to purchase the rental car insurance?

We all know that the insurance charged at rental car counters is expensive, often doubling the daily rate of the vehicle.  So it is no wonder that people are often curious if their existing auto insurance would provide them with coverage. 

Folks with Tennessee auto policies receive the same coverage on the rental car as the car that you are substituting the rental car for. Therefore, if you only have liability coverage on your car, you will only have liability coverage on the rental car, which in the event of an accident, could leave you responsible for paying for the rental car yourself. However, if you have comprehensive and collision coverage on your vehicle, that coverage would be afforded to the rental car.

There is one gap in coverage that your insurance will not protect you against, diminishment in value. What that means is, if you wreck a brand new SUV you are renting, the rental car company could argue that because of the accident, the SUV is no longer worth as much as it was prior to your accident. Tennessee auto policies do not provide for this coverage. Therefore, you should weigh that potential exposure when deciding whether or not to purchase the additional insurance. 

What about my personal belongings on vacation?

If you've ever gone on vacation with children, you know that often means bringing all of the toys and fun stuff with you. Between all of your clothes, luggage, and toys, the amount of stuff you bring on vacation can quickly add up.

Most people are unaware that their homeowner's or renter's policies can have limitations for coverage of personal property not at the residence. Many policies limit the amount of coverage for property away from the home to 10% of the personal property limit. For example, if your policy has $100,000 of personal property coverage, the maximum coverage you would have for personal property on vacation would be $10,000. 

If you are worried about having enough coverage, there are a couple of things you can do to protect yourself. First, check with your agent to see exactly how much coverage you do have and compare it to the inventory of items you intend to bring with you. Second, if you intend to bring special items such as jewelry or furs, you should make sure that you have these items scheduled appropriately on a floater.

Now get out there and enjoy summer while it lasts!