March 22,

Wednesday, March 22, 2023

Moving Insurance: It’s Worth Protecting Your Move

moving insuranceWhen you see all your belongings crammed into a truck, it’s natural to worry about their condition when they reach your new home. To ensure peace of mind until everything is safely delivered and in place, you can opt for moving insurance, just as you would for health insurance to protect your well-being. However, even the most cautious individuals or moving companies can experience accidents.

Therefore, it is essential to safeguard your possessions during a move. Here’s a guide on how to do just that.

Do you need moving insurance?

You may have pondered this question for valid reasons. Feeling anxious about entrusting all your household items to strangers is reasonable. What if they lose, damage, or destroy your prized possessions? While you may be more relaxed if you’re moving locally, it’s worth considering for a long-distance move. In specific situations, it’s advisable to obtain moving insurance. Due to these factors, you should investigate securing moving insurance.

What does moving insurance cover?

The specifics of your policy will determine what your moving insurance covers. Typically, moving insurance protects household items from damage during transit (and potentially storage) caused by anything from an earthquake to accidental breakage. Before hiring a moving company, asking about their liability coverage is crucial. Your chosen professional moving company should offer you more than one liability coverage option to select from.

How much does moving insurance cost?

Key factors such as the value of your possessions and the type of coverage you choose will determine the cost of moving insurance. The more coverage you opt for, the higher the price will be. The following is a breakdown of the two primary coverage options. Complete value protection is the next level of coverage, and selecting it will cost around 1% of the estimated value of your belongings. Third-party moving insurance can range in cost from 1% to 5% of your valuation estimate.

Does my homeowner’s policy cover the move?

Policies differ from one carrier to another. Some policies only safeguard your household goods while the movers pack them in your home.

What are your insurance options?

Federal regulations mandate that moving companies provide consumers with two types of coverage for out-of-state moves. Your mover is responsible for the value of the goods you request them to transport, but the liability level varies. To choose the appropriate level of coverage and declare the value of your belongings, you should be aware of your rights and responsibilities as a consumer. Furthermore, a third party may offer insurance coverage as a third option.

Released value protection

The moving company must offer “released value protection,” the most economical option set at 60 cents per pound. If you choose this option, the moving company will reimburse you for your belongings at up to 60 cents per pound, regardless of their actual value.  This basic coverage is free of charge, but you need to sign a specific statement on the bill of lading or contract agreeing to it. It’s important to note that this option compensates you based on the item’s weight, not its actual value.

Full-value protection

Of course, you might ask yourself why you’re paying someone much more to move your belongings if they’re only worth 60 cents a pound. But, unfortunately, your material belongings are worth more than 60 cents a pound. For that reason, long-distance movers offer “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 company, not the consumer, decides how amends will be made for the property.

Another caveat: The Surface Transportation Board, a federal organization overseeing moving companies, states that movers are only obligated to reimburse you for items valued over $100 per pound if listed explicitly on the shipping documents. It’s important to note that state insurance laws do not regulate released value and full-value protection. Instead, they fall under the U.S. Department of Transportation Surface Transportation Board.

Expanded mover coverage

Consumers have several options to upgrade their coverage depending on their risk tolerance. Some moving companies offer expanded valuations. With declared value, you can set a per-pound amount for your belongings.  It’s essential to consider that items like used clothing have little cash value. Lump sum value, also called assessed value, is another option that moving companies can offer. The coverage is similar to the declared value, but the consumer sets the amount by value instead of weight. This option is better if you have numerous small, high-value items that don’t weigh much.

What is valuation?

Moving companies offer various levels of liability under their “valuation coverage,” which determines the amount of harm the moving company will accept if your belongings become lost or damaged during a move. The movers will reimburse you according to the level of liability you choose. However, it is essential to note that all these liability options provide limited coverage and that valuation coverage is not insurance. Therefore, people often need to pay more attention to valuation coverage for moving insurance.

What’s not included in valuation coverage

Movers are not responsible for items in boxes they did not pack under valuation coverage. You will not be covered for damage to anything inside the package unless it shows significant wear. Additionally, if items are injured, you will not be covered for natural disasters like fire, hurricanes, tornadoes, windstorms, hail, etc.

Third-party moving insurance options

Insurance companies also offer “relocation insurance,” which provides coverage similar to the lump sum and declares value coverage offered by moving companies. If the moving company you’re using doesn’t give this type of valuation coverage, some people prefer to insure their belongings with a third party. Total loss coverage is also available, which will replace all your belongings in case of a catastrophe such as fire, theft, or truck accident. However, this coverage only applies in the event of the total loss of your belongings and does not cover individual items.

Moving insurance options if you DIY your move

Before transporting your possessions in a vehicle, rental car, or truck, check if your renter’s or homeowners insurance policy covers them. Then, consider purchasing relocation insurance as a separate liability policy to fill the coverage gap. If you rent a truck, you can buy rental truck insurance from the company, which may offer coverage for the car, cargo, and passengers. The level of coverage depends on the option you select. Typically, rental truck moving insurance covers accident damage, cargo protection, medical and life insurance for passengers, and supplemental liability coverage for accidents you cause.

Tips for protecting your move

  • You should take photos of your possessions before the move. This can be helpful, especially if you have insurance. By taking pictures beforehand, you can provide evidence of the condition of your items before the move and compare them with any damages that may occur during the activity.
  • When you pack your items, your actions can affect your mover’s liability. Therefore, it is important to pack carefully. Additionally, inform your movers of packages containing perishable, dangerous, or hazardous materials and label them accordingly.
  • In writing, communicate with your moving company about any articles of extraordinary value that you may have, such as heirlooms, art, antiques, jewelry, or valuable collections.
  • Report any loss or damage as soon as possible.
  • You should contact your state’s moving association, local consumer affairs agency, or county for more information.

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