When it comes to insuring your caravan, there are two primary types of cover: new for old and market value. I wanted to discuss new for old caravan insurance in more detail, telling you what it is and how it works.
A new for old caravan insurance policy pays out for a new model equivalent to your current tourer in a total loss claim. Your caravan is insured for the value it would cost to replace it with a new equivalent rather than its current market value.
When you think about it, new for old is pretty self-explanatory. Your current (old) caravan is replaced with a new, equivalent model in the case of a total loss claim.
Specialist cover for folding campers and trailer tents. Caravan Guard gives you cover for storm, theft, accidental damage or vandalism under their touring caravan insurance policy. Get a quote today.
New For Old vs Market Value: What’s The Difference?
Touring caravan insurance policies can differ greatly, with all kinds of add ons (such as European cover) available. However, insurance policies always fall into two categories:
- New for Old touring caravan insurance
- Market Value touring caravan insurance
New for Old touring caravan insurance replaces the insured caravan with a new equivalent in a total loss claim. So how does market value touring caravan insurance work?
Market value touring caravan insurance pays out the market value of the insured caravan in a total loss claim. Essentially, you’ll be paid whatever your tourer is worth at the time of the total loss claim.
These are vastly different policy types. The type of cover you choose is likely to affect your insurance premium significantly depending upon the age and model of your caravan.
For example, if you have a brand new caravan, the premium isn’t going to change much regardless of which cover type you choose. On the other hand, if you have a 10 year old caravan, market value cover is going to be much cheaper than new for old cover.
To explore how much of a difference the type of cover you choose can make to your insurance premium, I decided to do a little bit of research. Using the Coachman VIP 460 (2013), I got some insurance quotes to see how much the premium changed when changing between New for Old and Market Value cover.
Specialist cover for folding campers and trailer tents. Caravan Guard gives you cover for storm, theft, accidental damage or vandalism under their touring caravan insurance policy. Get a quote today.
Research: How Much Does The Type Of Cover You Choose Affect Your Insurance Premium?
To try and demonstrate how much your premium can change depending on the type of cover you choose, I used price comparison tools to get quotes for the Coachman VIP 460 (2013).
The only piece of information I changed for these quotes is the type of cover required and the value of the caravan (if you choose New for Old, you have to set the value of your caravan as the cost of the closest new equivalent). Here’s what I found.
New For Old Quotes
After entering all my information, I had a large number of quotes to choose from. In the table below, you will see the five cheapest quotes that I was offered.
The figure given is the annual premium. If you choose to pay monthly, you’ll pay a greater amount overall. To find out how that works, please read my post tips for reducing your caravan insurance premium. For that post, I researched how different the cost was on average depending on whether you pay for your insurance annually or monthly.
| Insurer #1 | Insurer #2 | Insurer #3 | Insurer #4 | Insurer #5 |
|---|---|---|---|---|
| £353.65 | £367.59 | £407.83 | £455.89 | £534.05 |
As you can see in the table above, the cheapest quote I was offered is £353.65 (annual premium). If I chose to break this down into monthly payments (as most people do), it would be £38.90 monthly, equalling a total premium of £466.80.
Before we directly compare the two, here are the quotes I got for Market Value cover.
Market Value Quotes
The market value of the Coachman VIP 460 (2013) is obviously much lower than the cost of a newer equivalent.
I had a look at a few dealers and worked out the market value to be around £14,000, hence the change in value above.
Again, I had a large number of quotes to choose from. Again, the table below shows the 5 cheapest quotes that I received.
As with the New for Old cover type quotes, the figure given is the annual premium.
| Insurer #1 | Insurer #2 | Insurer #3 | Insurer #4 | Insurer #5 |
|---|---|---|---|---|
| £203.76 | £220.88 | £232.51 | £258.71 | £294.55 |
As you can see on the table above, the cheapest quote I received was £203.76 if you pay in one payment. If you split it into 12 payments, it costs £22.41 per month, equalling a total cost of £268.92.
Let’s directly compare the New for Old and Market Value quotes.
New for Old v Market Value Cover: Direct Price Comparison
After getting quotes for the two types of caravan insurance, I compiled them to create a comparison. The comparison is what you see on the graph below.
As you can see on the graph, New for Old cover is significantly more expensive than Market Value cover. This is predictable, considering the significant variance in value between a second-hand and brand new caravan, particularly in this example where we’re looking at a caravan that’s a few years old.
This nicely brings us onto the next section of the post: is New for Old caravan insurance right for you?
Is New For Old Caravan Insurance Right For You?
This is a question that no one can answer for you, because it’s entirely dependent upon your personal circumstances and thoughts on the matter. However, if you really cannot decide, here are some of the things you should consider when choosing between the two types of cover.
New for Old cover is always the best option. If something happens to my caravan, I want a brand new replacement; I don’t want the market value of the caravan I currently own, because I would struggle to purchase a better caravan.
I think this is the case for the vast majority of caravan owners. If you can afford to pay for New for Old caravan insurance, then why not? As much as we’d all hate for something to happen to our tourers, at least we’d get a brand new equivalent if something did!
Anyway, here’s what you should consider if you still haven’t made your decision.
- How often you use your caravan
- The age of your caravan
Specialist cover for folding campers and trailer tents. Caravan Guard gives you cover for storm, theft, accidental damage or vandalism under their touring caravan insurance policy. Get a quote today.
How often you use your caravan
It’s important to consider how much you actually use your caravan. Regardless of how much you use your caravan, you need caravan insurance. But do you really need New for Old cover if you’re not going to use your caravan anyway?
If you don’t use or value your caravan very much, there’s no point paying more than you have to for insurance. You might as well go for Market Value cover instead.
The age of your caravan
Depending upon the age of your caravan, New for Old cover could be much more expensive than Market Value cover.
Weigh up the chances of something actually happening to your caravan. How often do you use it? Where are you storing it? If you don’t use your ‘van often and you’re storing it in a gold accredited CaSSOA storage facility, the chances of something happening to it are low if you’re honest.
If that is the case, why pay much more than you have to for insurance?
That just about wraps up this blog post. By this point, you should have a really good idea of what New for Old caravan insurance is and how much it’s going to cost you.
If you’d like to read more about caravan insurance, here are a few other posts I’ve written that might really help you:
- What is the average cost of caravan insurance?
- 7 tips for reducing your caravan insurance premium
- Is caravan insurance a legal requirement? Caravan Guard Interview
Specialist cover for folding campers and trailer tents. Caravan Guard gives you cover for storm, theft, accidental damage or vandalism under their touring caravan insurance policy. Get a quote today.