I receive a lot of emails every day and one of the questions that appears quite often is how do I insure my tiny house? Since I don’t have personal experience I usually pass on the question to a few people I know who own their own tiny houses and I hope they are able to respond with a good answer.
Yesterday I received an email from Australia from “Gypsy” or Kushti Bok who has been rejected or taken off of previous insurers once they see his unique mobile Vardo. He is trying to find a new insurer and is asking for help.
I need your help in answering this question. Those of you have have tiny houses, especially on wheels, how do you insure your home? If you live in a trailer based tiny house, bus conversion, house truck, or vardo, how do you insure it? Please respond in the comment section and share your knowledge with the rest of us.
Click here to view more pictures of the Kushti Bok Kombi.
Okay, there’s GOT to more pictures of that.
Yes, Ginmar, you can view more pictures here: http://www.myspace.com/gypsyvw/photos/albums/kushti-bok-kombi/1131371
I’ll add a link above too.
I don’t own a house of this type, but I formerly worked with a state licensing agency. I’m pretty sure you would insure this type of residence either as a 1.) motorized vehicle- like an R.V, or as a 2.) camper or mobile home- like a residential trailer, through a company that provides auto insurance.
In the state I reside in, you must insure a motorized vehicle but are not required to insure a camper or mobile home by law. The idea is that a pull-behind camper is covered under the auto insurance policy of the vehicle towing it. The law differs from state to state, though. It might be best to contact the agency that administers vehicle registrations in your area.
I found more just by googling…
http://www.myspace.com/gypsyvw/photos/12960943#%7B%22ImageId%22%3A12960943%7D
One option is you can set aside the money up front, though not many people have that kind of money to spare. (Personally, I intend to self-insure my tiny-house trailer. By that I mean, it will not be insured, but that I will reserve enough in savings to replace it should anything happen.)
Another option is to put a fixed amount of money in a savings account each month, and so long as nothing happens in the first few years you will eventually save enough to cover the cost of replacement. The down side to this option is that is likely more expensive and a little risky, but the plus side is that you are not throwing your money away and still have control of 100% of it – and will at some point not need to pay any more while still having complete coverage.
The most universally reasonable and manageable way for most people I would think is to insure it as a camper. People do custom conversions on buses (as an example) and get them insured all the time. I would think that would be easy to do with a custom “camper” too. It is a matter of semantics. We build what WE call a “tiny-house”, but insure it as a “camper” or “motor-home” because that is what THEY consider it.
Just my $0.02 worth of thoughts. On a good day they might be worth $0.03, but you might not value them at all. Take it or leave it. 🙂
-Michael
This is a great question.
Underwriting this risk:
As an insurance broker the first thing would be to look at if this would be defined as a mobile home or modified vehicle.
Since it is on the road, I would assume it is registered at a DMV. Is it registered as a mobile home or vehicle? (This is a good starting point)
How often does it move around, what percentage of time do you spend in one spot? What are the areas of navigation, do you stay in one state, many? Do you leave the country? These are also important factors to determine the risk.
What is the value of the modificatiosn done on this vehicle? Was it done by a professional (Like the PIMP your Car people) or was it done by the owner. (Reason for question- do we know its safe? what are the risks involved?)
An evaluation from a professional would definitely be required to establish the value. With an established value from a recognised firm, it woudl be easier to present this risk to an insurance company.
One major item of concern is the woodburning stove. You would want to make sure you have documentation proving it is installed to code, and not a fire hazard. Once thats established (if it can be established)finding insurance would take a lot of work and a good broker, but if everything checks out to safety codes, and the value makes sense, a specialty carrier may be easier convinced.
If you cold call a broker and tell them about this, I can guarantee the mention of the wood stove and the fact that its a vehicle converted to a home would turn most people off.
Really happy to have the opportunity to look at this, and I am going to ponder this one. If I come up with anything different than what I stated above, Ill let you know!
One more thing, the insurance on this type of modified vehicle could cost a significant amount. Because it is not the norm, the specialty carrier very well may want to collect the premium for a special case.
Where there is a will there is a way.
My husband and I live in a Park Model, and it was pretty straightforward to insure it as a manufactured home through our insurance agent, which is what he recommended. We pay about $500 a year for full replacement coverage of the house and its contents.
Other small homes may be harder, obviously, since they less clearly resemble any standard home or RV.
If your home has wheels and is registered as a motor home, GMAC will insure most things. I have a school bus conversion that they were happy to insure. Many people on school bus conversion forums have had luck with GMAC. I’m not sure how this would apply to other mobile homes, but it’s worth looking into.
Love the colors – thanks for sharing!
What about other peoples lives and property? I dont’ think it’s as simple as Mikael writes: “enough in savings to replace it should anything happen”.
Replacement value is only one way of thinking.
As soon as a vehicle is on the road I think another set of risks and responsibilities comes into play. While the investment in a tiny house may be significant to each owner this value pales compared to liability. Consider an road accident with major injuries or death – do you have savings to cover or would you want insurance?
I have called almost every insurance company in Metro Nashville area in order to insure a Tiny Home on Wheels and the primary reason no one would touch my THOW was that I would build it myself. Hence for the insurance company there was no one to hold liable for defects, spotty craftmanship etc. They want to be able to sue someone.
I almost got them to do it when I mentioned my brother was a licensed contractor, but then the insurance lady told me if something went wrong they would hold him liable.
I had one insurer tell me that they would insure it as a enclosed trailer with a stated value on it; but that was the same insurer that is refusing to replace theft on my brother’s work trailer. So my fear is that when someone says they will insure it, they will gladly take your money, then when you make a claim they will find a loophole to why they don’t have to pay.
The same company that insures our vehicles, GEICO, also insures our RV, though admittedly our RV is not of the homegrown variety. I think it would be a matter of getting your state or local governmental agency to title your vehicle as an RV/camper so that you could insure it as such.
Kushti –
I live in an airsteram trailer.
http://www.hofarc.com/category/portfolio/projects/airstream/
I currently am insured with Foremost. Geico also insures full timer vehicles, but they go through Foremost. So call them directly, they’ll be able to work with you.
I have recently been addressing that issue. My insurance is issued by USAA. This for honorably discharged vets, their spouses and children…these are the lowest rates for insurance on anything. The previous comments by the insurance broker is as accurate as anything I’ve heard. The only remark I have is about the registration. If this was built on a commercial flat bed frame the classification on the registration will be that. (I imagine this might be key to insuring it.) This is not an issue with me because I demo’d a rundown travel trailer for the frame and wheels. How to go about changing that classification to travel trailer(?) is something maybe some one else on the blog can address… ?
Am I the only one who sees a potential for major snafu with a homebuilt structure on a trailer frame that is registered as flat bed frame? In case of an accident the risk of being sued (rightly or not) seems huge.
I think reality is starting to hit…It’s nice to do this, but one does take a risk driving down the highway with one of these…all it takes is for something to break off and hit the car behind you.
This vehicle is a great example of just that…no-one in their right mind would insure this for road use…
In my area it is large fine to not tie down or cover loose loads..many people were killed and hurt by stuff that bounced off trucks…
I can see that pipe going thru someone’s windshield at 65 mph
Having read the above comments, it seems clear that this starts and ends with the engineering and manufacture.
A company like toirtoiseshell homes could have a valuable and profitable role to play here – get those designs rubber stamped by an appropriate engineering firm. Then build them with sufficient care that you are willing to take responsibility for the risk of manufacturing defects.
For the kits that’s a harder problem, but maybe you could require that a video be taken of the whole construction process so it could be reviewed in fast forwards in an hour or so to verify everything was done right.
But there is also the matter of putting some sugar on top to comfort the insurance company; calling it an RV seems like the way to go there. If you have to add a propane heater or something, go for the cheapest one on earth and leave the propane tank behind.
I fear we may be confusing things more than helping because we all speak from an American perspective and Kushti is in Australia. The carriers we use state-side most likely will not insure someone abroad. BUT, travel related companies like Good Sam Club or RVAmerica that specialize in RV insurance (rolling home, in whatever form) would be a great place to start.
http://rvainsurance.com/
http://www.goodsamrvinsurance.com/
Listen to Mila, she has explained the issue well. You have a vehicle tag so I assume it could, as others have stated, be insured as an RV only (tho, I am guessing the wood stove could be a problem, even there).
But if the concern is home insurance, why? Giving up that particular conventional ball and chain seems a small price to pay for freedom…
One other thing to consider. If you have homeowners or auto insurance, it covers someone who is hurt in your home or auto. If you have no insurance then YOU can be/are responsible for covering the other person’s medical bills. They add up fast. That’s the one reason I had homeowner’s insurance.
I doubt the insurance companies care how well it is built. They care about who they can hold responsible. This is why homemade homes are hard to insure.
Even if permanently parked on your own land, I’d want it insured.
It’s not the cost of materials, but… where would we live while rebuilding? We’re building weekends cause we have a rental, but once parked on our land, we’d have to rebuild FAST, hubby would have to take months off work while we lived in a tent or something…
Unless we had enough reserve to rebuild, I’d want it insured.
We purchased a tiny house last year. It took me over a week and at least twenty calls to different insurance agents to finally get two companies to agree to insure the tiny house.
Progressive came through after several calls to multiple agents. The stipulation was that we had to also insure the towing vehicle (our SUV) with Progressive as well.
The second was Foremost (a secondary insurer), although not through our primary insurance company as I would have suspected. I did find a very diligent local agent who was able to get them to agree to carry the insurance. Unfortunately, it took at least three weeks for the agent to get Foremost to agree and send a quote and by that time we had already gone with Progressive.
We feel most fortunate to have insured it as a wildfire came within 1/4 mile of the house this last summer and although it was not destroyed or even damaged, it did give us peace of mind.
Sara,
I hope this finds you well and also hope you may be able to help my fiance and I. We are trying to find insurance our tiny home. I talked with Foremost today but they said they would not insure it. Do you know as what specifically foremost was going to insure your home? What is your home classified as with Progressive? Would you be willing to share the name of your agent and his/her contact info? Thank you, thank you!!
All the best,
lisa
I have nothing to add to the insurance discussion, but wanted to say how charming their home is. So many tiny homes are either sterile looking or disheveled trash heaps. This wonderful home is filled with color, texture, and personality. Yet it appears from the photos that it is tidy and organized as well. It’s lovely.
It is really clear that most of the problem is dealing with ‘the norm’. Tiny house living is not a norm yet but has every chance of becoming one. If you are a member of an association then that group can approach an insurer. An inspection by a suitably qualified person should satisy the insurer etc etc. If enough people ask in one voice then you can change things. Don’t expect things like insurance companies to change themselves, they are too old, too stuck.
I have called all of the mentioned insurance companies to insure my tiny home with no luck (so far). I did call a transport company that will insure it for liability and property damage in transport.
That has made me hopeful I will eventually get it insured as a park model or RV. If anyone has any agents numbers you could share who found you coverage, it would be much appreciated.
Regardless of the obstacles,I love tiny houses and think in this economy, they could be a blessing to so many if the insurance industry would get on board.
We’re looking to insure our THOW as well and would be eternally grateful to whomever can share their insurance agents contact information.
Thank you in advance.