Does Your 5-year-old Need Full Auto Coverage?

With its sleek European design, the little red Ferrari "screams opulence and exclusivity," the sales blurb says. "Its extraordinary looks are the first thing that hit you."

Perfect midlife-crisis vehicle?

Nope, this dreamy supercar is for preschoolers.

The $450 Feber Ferrari California 12-volt ride-on car features realistic alloy-like wheels, a sporty steering wheel, wing mirrors and deep-injected paint so scratches can be buffed away. Made in Italy under license from Ferrari and designed in conjunction with the automaker's engineers, the car can go from 0 to 5 mph in mere seconds.

With wheels like these, it might seem like your child needs full auto insurance coverage. Combine kids with anything that moves, after all, and accidents are bound to happen. But auto insurance companies haven't discovered this emerging market. The insurance burden still falls to the parents.

Battery-powered ride-on cars have been around for decades, from pink Barbie Jeeps to flashy red fire engines. More than 25 million of the Fisher Price Power Wheels -- among the best-known brands -- have hit the road since they were rolled out in 1971.

Today's kiddie cars are fancier than ever.

The Power Wheels Cadillac Escalade, for instance, features a real FM radio, sound-boosting rear speakers, chrome wheels and grill and a power-lock brake system so the vehicle stops whenever the gas pedal isn't pushed. If your kid has a lead foot, you can set the high-speed lockout so the top speed is 2.5 mph, versus the daring 5 mph.

Even the basic plastic orange Cozy Coupe, when combined with some strong little legs, can cause dents and injuries.

Here's how insurance can help parents financially recover from toy-car crashes.

Your child crashes a toy car in the driveway and dents your car.

You could file a claim under the collision portion of your auto policy to repair your car, says Loretta Worters, vice president of the Insurance Information Institute.

"There would not, however, be any coverage for the child's toy vehicle," she adds.

Collision insurance is optional, so you're out of luck if you saved money by not buying it.

But even with collision coverage, it's probably not worth filing a claim if the damage is minimal. Your claim check will be reduced by the amount of your collision deductible. So if the repair cost is slightly more than the deductible, it might be better to pay out of pocket, particularly if this isn't your first claim, than risk a premium increase down the road.

Your tyke runs over and injures a pal with a toy car.

Your home insurance provides liability coverage to protect you against lawsuits for bodily injury and property damage that you and your family members cause others, Worters says.

If the friend requires medical attention, then your home insurance would cover the medical bills up to your policy's liability limits.

Your little driver crashes a toy car into the neighbor's (big boy) car and scratches it.

Whether your home insurance liability coverage would pay depends on the fine print in your policy. Generally home insurance policies exclude liability coverage for self-propelled vehicles when you take them off your property.

But there is an exception. Newer standard forms of home insurance do provide off-premises liability coverage for toys that are designed for children under age 7, are powered by batteries, and can't go more than 5 mph on level ground, says Christopher Boggs, vice president of insurance for the Insurance Journal's Academy of Insurance.

"But there is no guarantee that [policy] version is being used in every state or by every carrier," Boggs cautions. In other words, you might not be covered for the damage caused by your little speed demon once he rolls off your property. That goes for injuring others, too.

"There is a possibility that you are protected, but there is no guarantee," Boggs says. "Ask your agent, read your policy, or [add an endorsement] to remove all doubt."

You can buy an endorsement to provide liability coverage for low-power recreational vehicles, Boggs says, which covers the vehicles off your property as long as they have not been modified to go faster than 15 mph on level ground.

Here are more details about what's included in a homeowners policy.

Somebody swipes your kid's new toy car.

Homeowners insurance would cover the theft, but unless other items were stolen, the loss probably would be less than your deductible.

Most children's ride-on vehicles cost less than $500, and a typical home insurance deductible is $500 or $1,000.

The kiddie car cracks up in a wreck.

You'll have to open your wallet to fix or replace the toy car if your kid breaks it. But if the car develops a problem on its own, then check whether it's under warranty. Power Wheels, for instance, offers a one-year bumper-to-bumper warranty on its vehicles and has a national network of 300 authorized service centers.

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