You’re going on vacation and renting a beautiful property for the week. You’re not expecting anything to go wrong, but what happens if something does? What if you break something, or if you get injured? What if your stuff gets damaged or stolen?
What if something happens to my stuff?
You went out to dinner and came home to find your stuff stolen—a vacation surprise no one would want. Fortunately, your homeowner’s policy or a renter’s policy (at your permanent residence) can help. Your policy will cover your property for 16 named perils or occurrences (i.e. fire, theft, explosion) subject to special limits. However, if your property is damaged because you dropped it or your child spilled juice on it, there is no coverage.
Personal property coverage is that part of your policy that protects your possessions. If they are stolen, or damaged by fire/smoke or other covered “perils” anywhere in the world, your policy will pay for them. That’s true whether your belongings are at your primary home, in your car, or with you on vacation. There are dollar limits for certain items such as money, jewelry, and firearms, so check with your insurer. For personal property coverage on a homeowner’s policy, you typically get 50 or 75% of Coverage A, the total amount of coverage for your home. Renters get to choose the amount of personal property coverage.
How will you be compensated? It depends what you selected for your policy: replacement cost or actual cash value (ACV). ACV is the amount the item is worth, minus depreciation for its age. It will cost a little more for a policy that provides replacement cost since that is higher than ACV. You will get reimbursed minus the amount you have chosen for your deductible, the amount you pay out-of-pocket before your insurance company pays a claim. That’s why all of these decisions when you set up a policy are so important.
What happens if you get hurt at your vacation rental?
Maybe you were minding your own business, and preparing snacks for your day at the beach when a loose tile in the kitchen caused you to trip and fall. As a result, your vacation included a visit to Urgent Care. In this case, the owner of the rental property might reimburse you for your medical bills under Coverage F – Medical Payments To Others of their Property Policy. At California Casualty, we pay the necessary medical expenses that are incurred or medically ascertained within three years from the date of an accident. This coverage however does not involve negligence or liability. After all, the rental property owner didn’t know about the loose tile.
Pro Tip: Because the rental property owner’s policy is the one that would cover medical expenses, make sure that they have coverage.
What happens if you damage the property during your stay?
Let’s say you accidentally put a hot pan on the kitchen counter and the resulting mark doesn’t come off (oops!). You’ll need to pay for the repair. It’s the same if you place the plan there and intentionally caused the damage. The only time your homeowner’s policy will pay for a place that you rent, and do not own, is for property damage caused by fire, smoke, or explosion. Of course, it cannot be intentional.
Are you insured for vacation homes outside the country?
Your homeowner’s or renter’s personal property coverage protects your belongings when they are with you wherever they are. Similarly, your homeowner’s or renter’s liability coverage protects you from damage that you may cause to others or their property anywhere in the world.
When should you file a homeowner’s insurance claim?
If the damage is greater than your deductible, you may wish to file a claim. If it’s not, or if the difference is not much, you may to decide to pay out-of-pocket rather than going through insurance. For example, if the damage if $1,500 and your deductible is $500, you could file a claim. However, if the damage is $750 and your deductible is $500, you may decide to pay the difference. Know that filing a claim can cause your premiums to rise over time.
In addition, some vacation rentals charge a security deposit to cover any damage. Check with your prospective rental so you’ll know going in what to expect.
This article is furnished by California Casualty, providing auto and home insurance to educators, law enforcement officers, firefighters, and nurses. Get a quote at 1.866.704.8614 or www.calcas.com.