03 Nov Moving Insurance: How to Act to Protect?
Moving can turn into a stressful experience. One thing you can do to make it less painful is to carefully evaluate your options for protecting your household possessions while they’re in the hands of a moving company. A great amount of options are available from moving companies, private insurers and your existing Homeowner’s or Renter’s insurance. They can propose varying levels of insurance or valuation protection for different causes of loss.
No matter which mover you select, it pays to prepare in advance so that you’ll have time to evaluate your moving insurance and valuation options. Before considering the difference between moving insurance and valuation you need to understand that there are two basic categories of loss that might occur during a move. Both types of loss are the exception and not the rule, but either or both could occur during your move.
- Damage, breakage, marring and other types of loss caused by the mover’s or shipper’s negligence, carelessness or accident.
- A casualty loss, such as a fire, a storm or similar damage that might occur through no interference of the moving company and that often results in damage to other property besides the household goods you are moving.
Most homeowners and renters provide the second type of loss and usually have either a Homeowner or Renter’s insurance policy that covers their personal property. Insurance policies typically carry a deductible and provide coverage either on an all-risk or a perils basis:
- An all risk insurance policy includes coverage for any cause of damage or loss unless the cause is specifically excluded, such as wear and tear – and typically breakage and marring.
- A named peril insurance policy provides coverage only for the causes that are specifically listed in the policy – such as fire, lightning, windstorm, etc.
Most Homeowner’s policies provide all-risk coverage for buildings and named peril coverage for personal property. Renter’s policies may be written on a named peril or all-risk basis.
All moving companies are required by federal regulations to offer two types of coverage to consumers on out-of-state moves.
The first coverage is called “released value protection” and is set at 60 cents per pound. This means that you will be recovered for everything at 60 cents per pound. This coverage is included in the quote given by the moving company. All of your material belongings are certainly worth more than 60 cents a pound. For that reason, long-distance movers also offer what’s called “full-value protection”. The coverage is based on your valuation of the contents that are transported. The cost is based on about 1 percent of the valuation, so if you decide all of your belongings being shipped are worth $30,000, you would pay about $300 for full-value protection.
Full-value protection allows the moving company two options if any articles are lost, destroyed or damaged during the move. This is also called “full replacement value.” The moving companies can repair the item so it is in the same condition as it was before being damaged or they can replace the item with one similar with same cost. Movers are not required to reimburse you for any item that is valued at more than $100 per pound unless it is specifically listed on the shipping documents. This is set by the Surface Transportation Board, the federal organization that oversees moving companies.
Expanded mover coverage
There are several options available to consumers to upgrade their coverage. You can ask the moving companies for other valuation options. If your moving company is covering your belongings, it is not insurance. Moving companies cannot sell insurance. Instead, you are paying for stated liability, in other words, you are setting the limits for your moving company’s liability if your belongings are damaged, lost or destroyed. Some moving companies offer expanded valuations. Declared value allows you to set a per-pound amount for your belongings.
Make sure you aren’t fooled by scammers and always stay vigilant when you hire a new company. Remember, the cost of the move shouldn’t be the primary factor in choosing a moving company; it should be the quality of service and their reliability.