The argument surrounding whether or not to purchase an RV Extended Service Contract (**otherwise known as an RV Extended Warranty), has been around as long as the product itself. There are firm believers on either side of the debate: some RVers wouldn’t travel without coverage, while others wouldn’t pay a dime out of pocket to have it. Why is there such a difference in opinion? We will explore the answer to this question, along with a detailed discussion of what to look for in an RV Extended Warranty Provider within. With this advice, we at Wholesale Warranties seek to ensure that those who purchase coverage choose a policy that provides exactly what they are looking for.
Why should you protect your RV with an Extended Warranty?
Regardless of which side of the RV Warranty argument you fall on, it is undeniable that there is a large risk of mechanical failure you must be comfortable with when owning any type of RV. As the mechanics of RVs–especially Motorhomes and 5th Wheels–become increasingly complex, the chances of having something go wrong also greatly increases. Further, as the sophistication of the technology increases, so does the sophistication of repair—and the height of repair costs. For many RVers, this marks the end of solving breakdowns with mostly Do It Yourself repairs, leading many travelers to consider safeguarding themselves with RV Warranty policies.
So how likely is it for my RV to Breakdown?
The exact probability of suffering mechanical breakdowns will of course depend on your particular Motorhome, 5th Wheel or Travel Trailer’s age, make and model. However, Recreational Vehicle Industry statistics reveal that 3 out of every 10 RV’s will need some type of major repair by only the second year, and nearly every RV by just their 8th.
The cost of labor for technicians to work on modern RVs is something worth considering as well. Most RV repair facilities have labor rates of $100 per hour and rising, and this does not include the cost for parts. When making repairs on RVs the average cost of parts will be roughly double the cost of labor. So at $100 per hour labor, the average cost of parts would be around $200, for a total of $300 per hour worked on your RV.
As you can see, the risk of breakdown and costly repair is certainly worth considering when settling into your RV lifestyle and budget. But before you fork over your hard earned money to have your coach protected, there are several things you will want to investigate. Researching the following points will help you choose the right type of Warranty coverage for your RV, with a company that will be there for you when you need them most.
What exactly should I look for in an RV Extended Warranty Provider?
As you might expect, not all extended warranties are created equal. So how does a consumer decipher between the many plans available to ensure they get the best coverage for their vehicle? Here is a quick glance at Wholesale Warranties’ Top 4 Categories to Research in an Extended Warranty Provider:
1) Stability of Insurance Provider that Underwrites the Program
The insurance provider backing the RV Warranty is the company that ultimately guarantees the solvency of the program. In most expert opinions, including ours, making sure that the warranty policy is backed by an insurer is an absolute must. If you purchase a policy without insurance carrier backing and the policy provider goes out of business, you could be stuck with a warranty that is absolutely useless! You may have heard horror stories of RVers purchasing a policy, going to make a claim, and only then finding out that they can’t get in touch with anyone, or even worse, find that the warranty company is gone. These stories derive from RV Warranties with no insurance backing, otherwise known as a Risk Retention Group. To ensure that the policy you are looking to purchase is not only backed by an insurance carrier, but that the carrier is in good financial standing, a good question to ask the seller is if they know the AM Best Rating of the underwriter. AM Best is a company that verifies the validity and financial status of insurance carriers on an A to F rating scale. Companies with an A or even B+ rating should provide sufficient standing.
2) The Policy Administrator
The RV Warranty Administrator is the company that processes the claims, and acts as the point of contact for you or your repair facility when seeking payment for a breakdown. The company that handles the claims can have a huge impact on your policy’s ease of use. Especially in the RV market, the size of the company can make a huge difference. For instance, many smaller companies with limited staff are ill-equipped to handle the seasonality of the RV Market. One of the more frustrating things that service facilities are sometimes faced with is a long wait time during peak seasons. Throughout the summer and especially before and after holidays like Memorial Day Weekend, the 4th of July, and Labor day, busy mechanics can get extremely frustrated if they have to spend their valuable time waiting on hold for claim and repair authorization. In general terms, bigger administrators are preferable.
You will also want to take a look at the reputation of the RV Warranty administrator. Resources such as the BBB and other online reports can be a helpful indication of the kind of claims service you can expect. However, we always encourage our customers to be vigilant in obtaining context through their research–there are many complaints online, especially in the warranty industry, that have more to do with misunderstanding the coverage, being misled by a salesperson, or the customer not using the coverage correctly than the performance of administrator themselves. Large administrators will inevitably have at least a handful of unavoidable complaints, but if problems seem to be the norm, it could certainly be a red flag towards avoiding that particular policy.
3) RV Warranty Coverage
The most important portion of your program research should be an understanding of what is and is not covered by the Extended Warranty policy you are looking to purchase. We tend to see RV Extended Warranty Policies as investing in the protection of an RV’s value and performance, and just like with investing, we wouldn’t make financial decisions without a working knowledge of what we’re signing up for.
So what do we look for in coverage?
There are 2 major types of RV Warranties: the Exclusionary Warranty Policy and the Listed Component coverage option.
Exclusionary Policies – These policies tend to be the most comprehensive and easy to understand policies on the market. With this type of policy, it is up to the RV Warranty Company themselves to tell you specifically what is NOT covered. In other words, if an item is not specifically listed as EXCLUDED, the policy is obligated to cover the breakdown. Most people find it much easier to look through an exact list of items that they can expect to pay for out of pocket, than to pour over a list of covered items trying figure out what important things have been omitted. Of course, this higher level of coverage comes with a higher premium. For RVers looking for a lower cost while still covering many major components, a listed component coverage option could be a great choice.
Listed Component Coverage – As stated earlier, a listed component policy will state only those items that ARE covered. Therefore, if an item is not explicitly stated as covered, it is excluded. There are a wide variety of options with this type of coverage, so it is nearly impossible to address all of them here. However, I would like to address some common items that we recommend including in your listed component plan. These often overlooked items are worth noting:
Seals and Gaskets: With Motorhomes in particular, make sure you have this coverage or are at least aware of the risk involved with excluding it. When a Seal or Gasket fails in the engine or generator, for example, the cost of replacing it and the labor required can easily add up to an extremely expensive repair bill. Unfortunately, many plans leave this component group out, and it can be a huge area frustration for someone who purchased a warranty policy but did not know to look for Seals and Gaskets coverage.
Televisions and High Tech electronics: If you have a newer RV with a lot of amenities such as washer and dryer units, keyless entry, navigation systems, solar panels, leveling systems, slide outs, satellite systems, awning sensors and alarms to name a few, you will need to make sure that they are listed for coverage in your proposed policy. Luxury items like these are often some of the first to drop off a policy, but they can often be surprisingly expensive to repair or replace. Further, take a look and see if there is a limitation to the size they will cover in the RV. Items such as televisions are often covered, but limited to units with very small screen sizes.
4) Contract Provider
By contract provider, we are referring to the individual, company or dealership that is offering the Extended Warranty Policy for your RV. I feel that it is the ultimate responsibility of the RV Warranty provider to perform their due diligence in offering the most accurate coverage information for programs that have excellent performance standards and reputation.
As in many industries, the RV Extended Warranty industry can occasionally garner negative press thanks to a select few who do not inform customers properly, do not research the plans they are offering, or sell plans without any customer support after the policy is sold. Therefore, I feel that trust in the person and company providing you with coverage can be just as important as the policy they issue. If the provider offering you a warranty policy is not able to make you feel completely confident in their knowledge of the industry and the plan they are recommending, I would strongly suggest looking elsewhere
Interested in seeing how Wholesale Warranties answers these questions and more? Inquire for a free RV Warranty quote by clicking here or providing your information below: