SEATTLE – Summer is vacation time for most Americans. However, amidst the planning and fun, many travelers fail to find out how their auto and homeowners insurance will protect them while they're away, leaving them vulnerable when something goes awry.
"Taking a few minutes to understand how your insurance coverage works during times away from home can help make your vacation a relaxing one," said Jon Osterberg, PEMCO spokesperson.
PEMCO Insurance, Washington state's fifth-largest insurer of cars and homes, suggests would-be vacationers take a moment and review the following insurance issues before leaving town.
Car rental insurance: To buy or not to buy?
People who rent cars face the decision of whether or not to purchase rental insurance, which provides coverage in case of an accident. Many consumers believe that car rental companies pressure renters to purchase the insurance even if they have coverage with their own auto insurance company.
The insurance coverage you have for your personal auto carries over to the rental car, so long as you drive the rental car in the United States with the rental company's permission and the car isn't regularly provided and available for your use. Remember, the coverage you have on your own car is the same coverage you'll have for the rental car. If you don't have collision coverage on your car, you won't be covered for collision on the rental car.
"For example, the people who really should consider rental insurance are those who drive older cars and buy just liability coverage on their personal policies, with no comprehensive and collision coverage," Osterberg said. "If those people rent a nice, new car and cause an accident, their personal policy won't pay to fix the rental car. That's why you should check with your insurer if you're unsure about your coverage. A five-minute call could save you lots of money and anguish."
If more than one person plans to drive the rental car during the trip, make sure each person is added to the rental contract. If someone other than the person on the rental contract is driving the car when an accident happens, the rental car company probably will not provide coverage for either the car or injuries to others. PEMCO's insurance policy provides no coverage if a non-owned vehicle like a rental car is driven without the permission of the owner.
Murphy's Law of Road Trips
In an ideal world, nothing would ever go wrong on a road trip. No one would run out of gas in the middle of nowhere or get a flat tire on the side of a desert road. However, things happen while you travel, and it pays to be prepared and know your options.
According to Osterberg, most insurance companies offer towing and roadside assistance options, but they're not necessarily included as part of the basic insurance package. "Make a quick call, and your insurance company or agent can tell you for sure," Osterberg said. "Anyone who's tried to fix a broken fan belt with a car full of kids would immediately recognize the value of this coverage."
Towing insurance is necessary if you want all of your towing needs met. PEMCO Insurance policies cover you when your car is disabled, no matter the cause. The towing coverage applies when you're using rental or loaned vehicles with the owner's permission, and it covers you so long as your policy is valid.
Plans offered by car manufacturers often apply only during the warranty period, and only if the cause of the breakdown was covered under the warranty. For example, if you have PEMCO Insurance and bought towing coverage, and a vandal slashes your tires, PEMCO will pay the full towing cost, while a popular roadside assistance plan only pays for the first five miles of your tow.
According to the Insurance Institute for Highway Safety, seven of the top 10 deadliest crash days are in July and August. If you're involved in a car accident while on vacation, contact your insurance carrier immediately to report the claim - many providers can offer valuable assistance. In a situation like this, for example, PEMCO will help you find the right repair shop in the area. Your accident-related repairs are covered under PEMCO's repair guarantee program, and you won't have to worry about choosing between unknown shops in an unfamiliar city.
People who rent recreational equipment such as jet skis, canoes, or mountain bikes while on vacation should check their insurance coverage before they venture out. For instance, a PEMCO homeowners policy provides watercraft liability coverage for damages caused to others, depending on the horsepower of the watercraft. Check with your agent for coverage.
Protecting your valuables both home and away
Losing your valuables or having them stolen while you're on vacation is never easy, but knowing before you leave how your homeowners policy covers you -- and what to do if a theft happens -- can make replacing the items less challenging.
For example, if you leave your iPod in Central Park, it's not covered under your homeowner policy unless you bought a specific endorsement. However, if the iPod or an mp3 player was stolen, then you would have coverage. Keep in mind that the loss on most mp3 players would be under your deductible. The legally downloaded music on your iPod or mp3 player also would be covered if you had proof of where you purchased it and how much you paid. Illegally downloaded music would not be covered.
"Before you leave on vacation, read your policy or check with your agent," said Osterberg. "You'll get peace of mind, you'll know what to expect, and that will help you relax and enjoy yourself."
About PEMCO Insurance
PEMCO Insurance, established in 1949, is a Seattle-based provider of auto, home, boat, life, and umbrella insurance to Washington state residents. PEMCO Insurance is sold by community agents throughout the state and through PEMCO offices. For more information, visit www.pemco.com.