When it comes to towing with an RV, it's common for people to assume the insurance policy covering the RV also extends to any vehicle in tow. After all, the RV's much larger than the tiny car it's towing; why wouldn't it envelop the car in tow?
It's absolutely incorrect to assume your RV policy covers a car (or anything else) you're towing. Coverage and policies vary by company and state, so HowStuffWorks can't stress enough that you have a long conversation with your insurance agent before heading out on the road to make sure you've got all the coverage you need.
Very few, if any, RV insurance include coverage for a vehicle in tow. When you're on the road, you'll need an insurance policy for both your RV and the vehicle you're towing. If, heaven forbid, your towed vehicle becomes detached while traveling and hits another car, you'll most likely have two claims involved in the accident. The first will be a collision claim filed to repair any damage to your towed vehicle. This is why you need an insurance policy for the towed vehicle. The claim you'll make to your insurance company will be against the collision portion of the policy.
The other claim involved will be filed by the drivers of any vehicles, other property owners or people your out-of-control car hit after it became detached. These claims will most likely be against the liability portion of your RV insurance. This is why you also need full coverage (including liability) for your RV; a towed vehicle on the loose is usually considered the fault of the driver of the coach pulling the towed vehicle. It's a good idea to also have liability coverage on the towed car, in case you really made another driver mad during the detached towed vehicle debacle.
People who live in their RVs more than 150 days per year will also want to look into a type of RV insurance exclusive to recreational vehicles, usually known as a full-timers comprehensive personal liability policy. This type of policy extends your coverage to allow you to treat your RV like your home. Someone who trips inside your RV and breaks his or her ankle may make a claim against you as they could in your home, and this type of coverage is designed to cover such claims. This type of policy is exotic and many people who travel full time in their RVs don't realize they need it until their insurance company denies their claims because they use their RV as their primary residence.
There are other policies RV drivers should look into as well. Some pay for hotel stays while the RV is under repair. Others offer full replacement of a new model or upgrade if you total your RV. Again, policies change from company to company and across states. Speak to your insurance agent to find out what policies are offered.
On the next page, learn about converting a bus to an RV.