4 Myths About Insuring Your Toys

by Community Manager on ‎02-11-2015 01:43 PM - last edited on ‎04-10-2015 04:04 PM by Lithium Technologies (2,786 Views)

Discover the truth about insuring your motorcycle, boat or off-road vehicle.


Are you misinformed about the details of coverage in any of the following scenarios? Read on and discover whether you might be at risk for unexpected costs—and what you can do to protect your property and yourself.


ATV Meets Tree
Situation: While riding an all-terrain vehicle (ATV) in your yard, you lose control and run into a tree. Thankfully, you are unharmed, but the ATV has significant damage.

Your homeowners insurance will cover the cost to repair or replace your ATV.

No, it probably won’t. In most cases, homeowners insurance won’t cover damage to a motor vehicle unless its primary purpose is to service the premises—such as a lawn tractor—or to assist a handicapped person. A recreational vehicle that serves neither purpose will require its own separate policy.


Smooth Sailing?
Situation: Your friend is selling his boat, and you decide to buy it. You ask him where he purchased his boat insurance and he tells you he didn’t have to—that the boat was covered under his homeowners policy.

Adding a boat to your homeowners insurance policy is sufficient for most people.

Not really. While it’s true that a small boat can be added to a homeowners policy, coverage for damage and loss will be very limited, and liability coverage would need to be added as an endorsement to the policy. A separate boat insurance policy provides far better coverage.


Wrong Turn
Situation: You allow friends who are visiting to ride your ATV, provided they obey your strict rules—one person at a time and they must stay on your property. Unfortunately, one of your friends goes too fast on a turn and gets hurt when the vehicle flips onto its side.

Because your friend was injured on your property, the liability coverage on your homeowners policy will cover the medical bills.

Maybe, maybe not. Unless your homeowners policy specifically addresses friends and family using the ATV on your property, it probably won’t cover any of your friend’s medical bills, leaving you exposed to a potential lawsuit. On top of that, the liability limit on a homeowners policy that does cover this scenario may not be high enough to pay all your friend’s medical bills. An umbrella policy, however, exists for this very purpose—extending liability limits to a much higher level. (Tip: In order to purchase an umbrella policy, insurers may

require you to insure your home, car and ATV with them.)



Ready to Ride
Situation: You’ve been saving up to buy a motorcycle for some time, and you finally have enough for the bike of your dreams.

The motorcycle will be covered under your auto insurance.

No, it won’t. You must have a separate motorcycle policy that covers liability, and depending on where  you live and the bike’s value, there may be additional insurance requirements and coverage options.



To learn more about specialty vehicle insurance, stop by any AAA office or visit AAA.com/Insurance.


A version of this story appears in the March/April 2015 issue of AAA Living magazine.


Disclaimer: Products and benefits are subject to change and not available in all states.


Image credit/source: Roberto A Sanchez/Getty Images

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