Your insurer is covering a cargo van. You are driving a house.
That single mismatch is behind almost every bad outcome in this category — the totalled build settled for less than the cost of the lithium bank inside it, the liability claim denied after a visitor tripped on the step, the policy voided months after a fire because the underwriter discovered the owner had been living in the vehicle. None of these are exotic edge cases. They are the predictable result of insuring a converted vehicle on a contract written for the vehicle it used to be.
The fix is not complicated, but it is specific, and it has to be arranged before you need it. Insurance is the only component of a build you cannot retrofit after the failure.
Verify before you rely. Coverage terms, endorsements and eligibility rules vary by carrier and by state, and they change. Nothing here is insurance advice. Use it to ask better questions, then confirm the answers in writing with a licensed agent and against your own policy documents. Your declarations page is the authority on what you actually have.
The three ways a standard policy fails
Converted-vehicle claims go wrong in three distinct places, and they fail independently. You can fix one and still be exposed on the other two.
1. Valuation: the policy pays for what the book says
A standard auto policy settles a total loss at actual cash value — the market value of the vehicle at the moment of the loss, minus depreciation, minus your deductible. The carrier establishes that value from third-party guides and comparable sales.
There are no comparable sales for your build. There are comparable sales for a 2019 ProMaster 2500 high roof with 78,000 miles, and that is what the adjuster will find. The $9,000 electrical system, the insulation, the cabinetry, the 120 hours of your own labour: all of it is invisible to the valuation method. Owners routinely discover this at the worst possible moment, having insured a $60,000 asset for a $22,000 payout.
2. Classification: the title decides the product
Most carriers price and adjust from the vehicle classification on the title. If the title says “van”, you get van products. RV-specific coverages — personal effects, emergency expense, vacation liability, attached accessories, awning and roof-mounted equipment — either are not offered or are not triggered.
This is why the titling question is not bureaucratic housekeeping. Reclassifying the vehicle as a motorhome is frequently the step that unlocks the entire coverage category, and it also changes your registration class and fee basis. That side of it is covered in RV and trailer registration: weight classes, licences and fees.
3. Use: the difference between a vacation and a residence
Insurers classify by how the vehicle is used, not by how it looks. A recreational-use policy assumes the vehicle is stored and driven occasionally for trips. Living in it — the common industry threshold is roughly six months a year, though carriers differ — is a materially different risk, and it needs either a full-timer’s policy or a full-timer endorsement.
Owners who do not disclose this are exposed to the ugliest failure mode in the category: material misrepresentation. The claim is not merely reduced. It is denied, on the grounds that the use did not match the policy classification, and the policy may be rescinded. This applies to snowbirds and long-season workampers too, not just people who sold the house.
Valuation methods, compared
This is the part most coverage of the topic skips, and it is worth more money than everything else on the page.
| Method | How the payout is set | Typical premium | Custom build fit | Watch for |
|---|---|---|---|---|
| Actual cash value (ACV) | Carrier determines market value at time of loss, less depreciation and deductible | Lowest | Poor. Ignores conversion investment entirely | The default on most policies. If nobody discussed valuation, this is almost certainly what you have |
| Stated value / stated amount | You state a value; the carrier pays the lesser of stated amount or ACV | Low–moderate | Poor to fair. Widely mistaken for agreed value | The “lesser of” clause. It caps your payout without guaranteeing it |
| Agreed value | You and the carrier agree a figure up front, usually supported by an appraisal; that figure is paid on a covered total loss | Moderate | Strong. The standard answer for custom conversions | Eligibility rules, appraisal requirements, and how often the agreed figure must be revisited |
| Total loss replacement | Carrier replaces with a comparable new unit, typically within a defined age window from new | Highest | Limited. Aimed at newer factory units, rarely available for self-builds | Age and first-owner conditions |
Two things follow from that table.
Stated value is not agreed value. They sound identical and behave nothing alike. Stated value sets a ceiling and then still lets the carrier settle at market. Agreed value sets a floor and a ceiling at the same number. If an agent uses the terms interchangeably, get the distinction confirmed in writing and check the wording on the policy form.
Agreed value is the reason to do any of this. Everything else in this article — the appraisal, the receipts, the photographs, the titling — exists to make you eligible for it. A converted vehicle on ACV is an uninsured build with an insured chassis.
Partial losses usually behave differently from total losses, even on an agreed value policy: carriers commonly pay repair cost rather than the agreed figure. Ask specifically how partial losses are settled, because most claims are partial.
What “permanently installed” means, and why it decides everything
States and carriers converge on the same test: does the vehicle contain permanently installed systems for living, rather than camping gear that happens to be inside a van?
The commonly required list runs to some subset of:
- A permanently mounted bed or convertible sleeping area
- A fixed cooking appliance with an onboard fuel source
- A potable water system — tank, sink, running water
- A 120V or 12V electrical system with a fixed power source and distribution
- Toilet facilities
- Heating or cooling independent of the engine
The number required varies significantly. Some states want four or more of these; Florida’s self-conversion route has historically asked for far fewer. Some require a physical inspection, some accept photographs and an affidavit, and some accept an owner’s sworn statement.
The operative word throughout is permanently. A portable camping stove and a mattress on a plywood platform will not pass. Anything that can be lifted out without tools is furniture, not a system.
Do not treat forum reports as authority here. The requirements are set by your titling state and they change. Ask your DMV or tax collector’s office for the written criteria and the inspection form, and build to that document. Which state’s rules apply is itself a decision — see full-time RV residency: domicile, registration and insurance by state.
The documentation pack that gets you agreed value
Underwriters are not being difficult when they ask for evidence. They are being asked to guarantee a number, and they need a basis for it. Owners who arrive with a folder get agreed value; owners who arrive with an assertion get ACV.
Assemble the following, and keep it current:
Build cost record. A line-item list of parts and labour, with receipts. Batteries, inverter, charge controller, wiring, solar, water system, heater, insulation, cabinetry, appliances, fabrication labour. Total it. This single document does most of the work.
Photographic build log. Progress photographs from bare shell through to finish, showing systems being installed rather than just the finished interior. This demonstrates both the value and the workmanship. Photograph the electrical before you close the walls — you will need it again for any future claim involving fire.
Professional appraisal. Most carriers require one above a threshold. Use an appraiser with documented experience of vehicle conversions rather than a general vehicle appraiser; a report that itemises the systems is far more useful than one that names a number.
Certified weight ticket. A public scale ticket showing actual weight. Needed for titling in many states, and it settles arguments about whether the vehicle is within its ratings.
Electrical and gas system documentation. Wire gauges, fusing, isolation, propane certification if fitted. Some insurers ask; almost all will care after a fire. Work certified by a recognised installer is worth more than the certificate costs.
Title showing the correct classification, where you have been able to obtain it.
Inventory of contents with photographs, for personal effects coverage.
Update the build record and re-check the agreed figure whenever you add a significant system. An agreed value set before you fitted the lithium bank and the DC air conditioning is now the wrong number, and it will not adjust itself.
What a converted-vehicle policy should actually contain
Beyond valuation, these are the coverages that matter for a build and that a standard auto policy either omits or under-limits. Treat this as a checklist for the conversation with your agent.
Custom equipment or custom parts coverage. Covers permanently attached modifications. Check the sub-limit carefully — a default limit of a few thousand dollars is common and is nowhere near a real build. This is separate from the vehicle’s insured value on many forms.
Personal effects / contents. Removable property: tools, laptops, cameras, bikes, clothing. Usually a separate limit, often with its own deductible.
Vacation liability or premises liability. Liability arising when the vehicle is parked and being used as a residence — the visitor who is injured inside or beside it. Standard auto liability generally responds to driving, not to occupancy.
Emergency expense / loss of use. Lodging and transport if the vehicle becomes uninhabitable away from home. For a full-timer this is not a convenience coverage; it is the equivalent of a homeowner’s additional living expense.
Roadside assistance rated for the vehicle. Confirm the weight and length limits, and confirm the provider can recover a vehicle of your size. Ordinary auto roadside is frequently useless for a 9,000-lb van.
Attached accessories. Awnings, racks, solar arrays, satellite equipment, exterior storage.
Full-timer’s coverage or endorsement, if the vehicle is your residence for a substantial part of the year. Ask directly what the carrier’s threshold is, and whether they require that you list no other primary residence.
Diminishing or vanishing deductible, and glass terms. Minor by comparison, but large windscreens on tall vehicles are expensive and get hit.
If the build is a trailer rather than a van
Self-built teardrops, expedition trailers and gutted-and-rebuilt travel trailers sit in an awkward spot. Most states do not require liability insurance on a trailer, because the tow vehicle’s liability follows it while it is being towed. Owners reasonably conclude they are covered, and then discover the limits of that assumption.
Physical damage is the gap. Comprehensive and collision on the tow vehicle generally do not extend to the trailer, and nothing at all responds once the trailer is unhitched and sitting at a campsite — which is where it spends most of its life, and where hail, falling branches, fire and theft find it. A separate trailer policy with agreed value is the equivalent step, and it is usually inexpensive relative to a motorised build because there is no drivetrain and no road exposure to price.
Lenders complicate this. If the build is financed, the lender will impose its own coverage requirements, and those requirements are about protecting the collateral, not about protecting you. Meeting them is a floor, not a specification.
What it costs, and how to think about the premium
Published ranges for full-timer coverage commonly run from roughly $1,500 to $4,000 a year, with recreational-use policies on smaller conversions falling well below that. The spread is wide because it is driven by things you can only partly control: vehicle value, garaging address, class and weight, driving and claims history, credit in states that permit its use, and declared usage.
Two adjustments are usually worth their cost:
Moving from ACV to agreed value adds a modest premium and changes the total loss outcome by tens of thousands of dollars. It is the highest-return line on the policy.
Raising liability limits costs comparatively little. If the vehicle is your home, your liability exposure looks like a homeowner’s, and homeowner-scale limits are appropriate.
Two adjustments are usually not worth it: shaving coverage to hit a monthly number you picked arbitrarily, and buying a policy from whichever quote engine returned the lowest figure without reading the valuation clause. Insurance premium is one of the more predictable lines in the five-year cost of RV ownership, and one of the few where paying more is straightforwardly rational.
If you are budgeting for full-time use specifically, the premium interacts with several other costs that dealers and lifestyle content tend to leave out — the itemisation is in full-time RV living: the costs dealers don’t itemise.
Where owners actually get caught
Insuring the shell and meaning to update it later. The build takes eighteen months. The policy was written on an empty van in month one. Nobody told the carrier. Update the policy at each major stage, not at the end.
Assuming a towable is covered by the tow vehicle’s policy. Auto liability may extend to a trailer in tow. Comprehensive and collision on the trailer itself generally do not, and nothing follows it once it is parked and unhitched.
Buying “stated value” believing it is agreed value. Covered above. It is the single most common misunderstanding in this category.
Non-disclosure of full-time use. The claim is denied for misrepresentation, which is worse than being uninsured, because it can also mean cancellation and a disclosure obligation on every future application.
Non-disclosure of rental or workamping activity. Listing the vehicle on a peer-to-peer rental platform is commercial use. It generally requires a different policy, and doing it quietly is a fast route to a denied claim.
Confusing insurance with warranty. They cover different failures. Insurance responds to sudden accidental loss; service contracts respond to component breakdown, subject to exclusions that are the real story. See warranty and extended service contracts: what they actually cover.
Letting the agreed value go stale. Values move, builds grow, and a five-year-old agreed figure is a five-year-old opinion.
The honest summary
If you have built or bought a converted vehicle and you have not had a specific conversation about valuation method, classification and declared use, assume all three are wrong. That is not pessimism; it is what the default settings produce.
The work is one afternoon: total your build costs, photograph what you have, find out what your titling state requires, get an appraisal if the value warrants it, and then ask an agent who writes conversions — not a general auto agent — for agreed value with full-timer terms if they apply. Then read the declarations page when it arrives and confirm that the valuation clause says what you were told it says.
The trade-off is real and worth stating: you will pay more per year, possibly considerably more, and in most years you will get nothing back for it. That is what the product is. The alternative is a build worth $60,000 that settles at book value for a used cargo van.
Frequently asked questions
Can I insure a van conversion that still has a van title? Often yes, but usually on auto terms, which is the core problem. Some carriers will write RV-style coverage on a van-titled vehicle with documentation of the conversion; many will not. Reclassifying the title generally widens your options substantially.
Do I need an RVIA-certified build to get proper coverage? No. Certification can simplify underwriting and is relevant for professionally built units, but self-builds are insurable on their merits. Documentation compensates for the absence of certification — that is precisely what the build record and appraisal are for.
What is the difference between agreed value and stated value? Agreed value pays the figure written into the policy on a covered total loss. Stated value typically pays the lesser of the stated figure or actual cash value, which means the carrier can still settle at market. Check which term appears on the policy form itself, not just in the quote.
How long do I have to live in the vehicle before I need full-timer coverage? There is no universal rule. Around six months a year is a common industry reference point, but carriers set their own thresholds and some ask whether you maintain another primary residence. Describe your actual pattern of use to the carrier and get the classification confirmed in writing.
Will my claim really be denied for not disclosing full-time use? It can be, and denials on this basis are documented. The mechanism is material misrepresentation: the risk the carrier priced is not the risk that existed. Disclosure costs a higher premium; non-disclosure costs the entire claim.
Does my homeowner’s or renter’s policy cover belongings in the vehicle? Sometimes, at reduced limits and often only away-from-premises. If the vehicle is your only residence, there is no homeowner’s policy to fall back on, which is the gap full-timer coverage is designed to fill.
Do I need a professional appraisal? Above a certain value most carriers require one for agreed value. Below that, a thorough build record with receipts is frequently sufficient. An appraisal costs a few hundred dollars and tends to pay for itself in the valuation conversation alone.
Does adding solar, lithium or a rooftop air conditioner change my policy? It changes the value at risk, so it should change the agreed figure and possibly the custom equipment limit. Tell the carrier. Systems installed after the last valuation are the ones most likely to be argued about.