Date: June 26, 2006
For more information contact: Eileen Mallow, Assistant Deputy Commissioner, (608) 266-7843 or eileen.mallow@wisconsin.gov

Summer Raises New Insurance Issues for Consumers

Madison, WI—With summer in full swing, the Office of the Commissioner of Insurance (OCI) reminds consumers to make sure their insurance coverage meets the needs of their summer vacation plans.

"We can't stress enough how important it is for consumers to be aware of what their insurance policy covers during the summer months," said Jorge Gomez, Commissioner of Insurance. "This will save time, money and stress in the long run."

Consumers need to be aware of what their insurance covers when it comes to travel, summer recreational and rental vehicles, and certain backyard hazards.

Travel

Travel insurance can be a source of protection for expensive vacations in the event of an unexpected illness or your airline suddenly going bankrupt. Travel insurance can be purchased through many travel agencies when you are booking the trip. But the coverage included in the policy is almost always very specific, so be sure to read the fine print before you purchase.

Travel insurance usually covers trip cancellations and delays due to unexpected sickness, injury or death of the insured family member, a financial default of a tour operator, bad weather or natural disasters that close travel services, and other circumstances that could not have been reasonably foreseen.

But travel insurance packages come with many limitations as well. For example, lost or damaged luggage may be covered, but expensive items such as cameras, jewelry, medicines or sporting goods are usually not. Also excluded in many policies are airline labor strikes, health and accident situations such as pregnancy, high risk sports and other similar foreseeable situations.

"The important thing for consumers to remember is to read the policy, paying close attention to the exclusions," said Gomez. "And if you have any questions or doubts about your coverage, make sure to call the company offering the insurance."

Summer Recreational and Rental Vehicles

Because boating is such a popular summertime activity in Wisconsin, consumers should be aware that boats can either be insured by homeowner's insurance policies or by a separate boat owner's policy.

But as with travel insurance, boater's insurance contains many limitations. If insured under your homeowner's policy, coverage for the boat, including all its furnishings, equipment and engines or motors, may be limited to a certain dollar amount. Theft may not be covered if the boat is away from the residence listed on the policy and wind and hail damage may only be covered if the boat was housed in a fully enclosed building or boathouse. The liability coverages for many types of watercraft are also excluded from homeowner's policies based on the size of the motor.

A separate boat owner's policy or an endorsement added to your homeowner's policy provides more comprehensive coverage for the boat and its furnishings, equipment, and engines or motors and would provide liability coverages not otherwise provided by the basic homeowner's policy. However, boat owner's policies or homeowner's endorsements also contain limitation and exclusion that should be reviewed.

Another important consideration for consumers on vacation is whether or not their rental car is covered under their auto insurance policy. It is important to check with your auto insurance agency before leaving to verify whether or not your rental car will be covered.

If your regular auto insurance does not include rental vehicles in its policy, rental car companies often sell collision damage waiver coverage (CDW). Collision damage waiver coverage shifts any liability for collision damage from the person renting to the car rental company. Purchasing a CDW is probably worthwhile if you will be renting a vehicle outside of the United States and Canada.

Backyard Hazards

Summertime essentials such as pools, trampolines and hot tubs can all be expensive liabilities if you are not properly insured. Some insurance companies will not cover risks such as unfenced pools and trampolines. Plan ahead and check your local safety standards and building codes before purchasing one of these backyard items. It is also a good idea to contact your insurance agent about purchasing more liability insurance since your new toy will also be your new liability risk.

Homeowners and renters with dogs must also be sure to have liability insurance. Many insurers require dog owners to sign liability waivers for dog bites, others charge more for breeds such as pit bulls and Rottweilers, and some will not insure households with certain breeds of dogs at all. Bottom line: if you're going to let your dog out in the yard this summer, take steps to socialize your dog to behave well and insure yourself against dog bite liabilities.

Plan Ahead

The most important tip for consumers to remember during the summer months is to plan ahead. Consult with your insurance agent about your current insurance policies and any summertime liabilities you may still need to insure.

The OCI publications, "Consumer's Guide to Insurance," "Consumer's Guide to Homeowner's Insurance" and "Settling Property Insurance Claims," can be ordered free from the agency by writing to OCI Publications, P.O. Box 7873, Madison, WI 53707-7873, calling 800-236-8517 or visiting the OCI Web site at oci.wi.gov.

Created by the Legislature in 1871, Wisconsin's Office of the Commissioner of Insurance (OCI) was vested with broad powers to ensure that the insurance industry responsibly and adequately meets the insurance needs of Wisconsin citizens. Today, OCI's mission is to lead the way in informing and protecting the public and responding to its insurance needs.