Summer Insurance: What You'll Need

Ahhh, summer. The pool! The boat! The risks? For those times when vacation takes a decidedly painful turn, be prepared with the right insurance.

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If you're buying a new watercraft or other toy, or are renting cars and homes, you should consider your summer insurance needs.

"Safety does not take a summertime break," says Lynne McChristian, Florida representative for the Insurance Information Institute, or III. "That includes knowing your risks and considering your insurance coverage and liability."

"I don't think the vast majority gives it a thought," adds Bill Wilson, associate vice president for the Independent Insurance Agents & Brokers of America in Alexandria, Va.

But that doesn't have to include you. Here's what you'll need.

Pool insurance to keep you afloat

That sparkling backyard pool helps create an at-home summer resort. But you could find yourself in the financial deep end without the right insurance coverage.

Regular homeowners insurance may not provide enough coverage for a pool, and some policies may even exclude pools, says Kevin Smith, a spokesman for Allstate.

Pools can be dangerous, so they increase your liability risk because you stand a greater chance of being sued or having to pay someone's medical expenses. According to the U.S. Consumer Product Safety Commission, nearly 400 children younger than 15 drown each year in pools and spas.

When you put in a new pool, Smith suggests boosting your liability coverage. Consider an umbrella policy if it's available in your state. That increases your coverage beyond what you have on other policies.

"For instance, a few hundred dollars a year may allow you to get up to $1 million in additional liability protection beyond your existing auto and/or property insurance coverages," Smith says.

Before installing a pool, review the local standards and codes where you live. Those could include requirements for safety equipment, such as fences and locks, according to the III.

It's not just any ol' car

Summer is the season for taking antique and classic cars out of the garage and showing them off in club events and parades.

Those vehicles can demand separate insurance from your regular car because of their more limited use and their value. Collector cars can become much more valuable as they age.

Insurers offer agreed-value or stated-value policies. You'll likely want agreed-value, which means you and your insurer agree on the car's value. In case of loss, the company will pay you the full amount on the policy, less your deductible. Stated-value policies leave the value of your old classic open to interpretation by the insurer, according to the III, which adds that these policies are rarely sold.

See if your insurer has the resources to help find rare parts and mechanics with the know-how to handle any damage to your baby. Ask if you'd be able to send the car across state lines to a mechanic of your choice.

Liability coverage is especially important with collector cars that can be difficult to drive if they have small windows or lack mirrors, notes Jay Quail, executive director of the Classic Car Club of America.

Boat coverage from stem to stern

Buy a watercraft for summer fun, and you'll take on a boatload of risk.

Homeowners or renters insurance may provide all the coverage you need. The Insurance Information Institute says for larger and faster boats, or personal watercraft-like Jet Skis, you'll need a separate marine policy.

Your premiums will depend on your boating background, type of boat and where you'll use it.

What this all means is that sailboats cost less to insure than riskier speed boats. And, boat owners in Miami-Dade County, Fla., pay the highest premiums because of hurricanes, thefts and year-round use of their boats, says Jeffrey Berndt, vice president of the National Boat Owners Association.

The group says your age, driving and credit histories, boating certifications, and whether you own or rent a home can affect your policy cost, too.

Proper boat insurance will pay not only if your boat is accidentally lost or damaged, but it also will cover damage or injuries to others as well as your legal costs if someone takes your boat for a joy ride without permission.

Easy ridin' the right way

Motorcycles help to rev up the sights and sounds of summer road travel.

In northern states, bike owners who ride mostly during the warm-weather months may be able to get what's called a "lay-up" policy, according to the III. The policy suspends all coverage except comprehensive during the winter, and this makes it cheaper for the rider.

But a part-year rider may want to consider full-year coverage anyway, even though comprehensive covers nonaccident damage, such as from fire, vandalism and theft.

"A 12-month policy is priced to reflect the length of the riding season and risks during the nonriding season for each state," says Allstate's Smith.

All motorcyclists are required to have liability coverage for property damage and bodily injury that you may cause to other people in an accident, Smith says. Check with your agent if that coverage also extends to passengers on your bike.

Whether you've had an accident, where you ride, your age and how you store the bike all affect your motorcycle insurance premiums. Discounts are available if you've taken a safe-riding course, are a member of a motorcycle organization or club, or if you own more than one bike.

Hit the road with the insurance you need

The idea of a summer road trip can seem dreamy. But when you go to rent that convertible, know what your own auto insurance covers before you accept the rental company's policy.

According to the III, the insurance sold at the rental counter typically includes -- among other things -- liability protection for lawsuits, personal accident insurance for medical or ambulance needs, and personal effects coverage for theft of your belongings in the car.

You may not need all of that. Check your auto policy and your credit card agreement, which also may provide car rental coverage.

Here's a key question: If a rental is damaged, will you have to pay upfront for repairs and wait for reimbursement, or will your insurer cover the cost right away?

"That's a huge issue, and if you are ever caught in it where you decline the car rental company's insurance thinking you are covered and you find out you are responsible for paying thousands of dollars in costs, that's a huge reality check," says Cynthia Brough, a consultant and former national spokeswoman for auto club AAA.

Going across the border into Canada or Mexico? Look into insurance requirements and whether you need to bring proof of coverage.

That home away from home

Renting out your home for vacation use can be a budget helper for everyone involved.

Vacation rentals are growing in popularity, but insurance requirements vary considerably, depending on the length and frequency of the stays.

Some insurers may allow a short-term rental (a week or several weekends) of your primary home under your home insurance policy. The Insurance Information Institute says some other insurance companies may require additional coverage or a renters insurance policy.

For longer rentals, you'll need a landlord or rental-dwelling policy that can cost 25% more than a standard policy. But you'll get more protection against property damage and liability.

Regular rentals -- whether short- or long-term -- won't be covered by your homeowners insurance. You'll have to buy the sort of business policy appropriate for either a hotel or bed-and-breakfast, according to the III.

If you're renting someone else's home for your own summer vacation, talk to your agent about whether your own home insurance covers damage or theft where you're renting. If you book through an online vacation listing website, it may offer a property damage policy as part of the package.