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Generally speaking, RV insurance policies usually offer 3 different loss settlement options:
1. Full replacement cost (most expensive)
2. Stated or agreed amount (middle of the road)
3. ACV (least expensive)
For the most part auto insurance companies only offer ACV but some do offer replacement cost.
Gap coverage is sometimes available. It provides coverage for the difference from ACV and the loan amount. It's protection for the lender but it will alleviate the financial obligation of the borrower should the unit be totaled. The main benefit of replacement cost or agreed value is that protects the policy holders investment in an otherwise depreciating RV.
Definitions:
1. Full replacement cost: Usually covers the cost of replacing the RV with like kind and quality should the cost of repairs exceed the current value. Limit may exceed original purchase price. Coverage normally expires in year 5. Some policies revert to Stated or agreed value after year 6.
2. Stated or agreed value: The amount is stated on the declaration page and is normally the purchase price. Full amount is payable should the loss exceed the current value.
3. ACV. The value of the RV at the time of the loss. In other words, the deprecated value of the RV at the time of the loss.
Companies are different as policies vary in the scope of coverage. In choosing insurance most compare price rather than the loss settlement provisions. A policy providing full replacement cost is going to be more expensive than one that provides ACV.
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