The Ultimate Guide to Moving Insurance

Newly moved in company glancing over their moving insurance policy

The Ultimate Guide to Moving Insurance

Moving to a new place isn’t easy. There are items to wrap, boxes to pack, and things to put away before the moving trucks arrive. During the moving process, people spend hours trying to protect their items from breaking during transit. Unfortunately, even their best efforts may not provide enough protection from unexpected events. Moving insurance can reimburse customers for lost, stolen, or damaged items. It also allows them to replace or repair their valuables. Are you relocating to a new area soon? In our guide to moving insurance, you’ll learn more about what coverage is right for you.

What Is Moving Insurance?

Before a mover drops by to pack your valuables for your upcoming move, you’ll need adequate coverage for your household goods. Moving insurance protects your belongings while movers transport them to your new place. They protect your goods when they’re on the truck and sometimes when they’re in a temporary storage unit. It’s essential to purchase these policies because unexpected events can damage your valuables. For your peace of mind, get moving insurance to protect your goods during the transit process.

If you hire a professional mover, you can ask them about moving insurance. These policies can reimburse you for valuables that are lost, damaged, or stolen during the relocation process.

You can only buy these policies through a professional mover. This insurance usually lasts 90 days and covers belongings stored at a moving company’s warehouse. Additionally, you can buy extensions to protect goods stored for longer periods. However, they don’t cover any items that you place into self-storage facilities.

Moving insurance isn’t a true insurance policy since movers aren’t licensed to sell them. Instead, they offer valuation coverage that works in a similar way to insurance. It will reimburse you for covered losses listed within the contract, like damaged tables or chairs.

State insurance laws don’t apply to moving insurance policies, so customers need to read the contract before agreeing to the terms.

Basic Moving Insurance Policies

Man comparing moving insurance policies to find the right one

According to the Insurance Information Institute, moving companies offer various valuation coverage options for their customers. The federal government mandates that interstate carriers provide released value and full value protection to their customers. Professional movers also offer separate liability coverage through third-party companies.

You’ll learn about each coverage in the following sections.

What Is Released Value Protection?

Released value protection, or basic carrier liability, is the cheapest moving insurance with minimum coverage. Federal law requires interstate movers to offer this protection to customers during interstate moves.

Although you can receive released value at no additional cost beyond your moving charges, you’ll still have to ask for this coverage. Movers don’t automatically provide this type of coverage unless there is a contractual agreement in place.

This valuation option doesn’t provide full protection for your items. Your moving company won’t replace or repair household goods based on the estimated value of these items. Instead, they will only compensate you based on the weight of each belonging.

How Released Value Protection Works

They reimburse customers 60 cents per pound for each article. It doesn’t matter whether these items are family heirlooms, valuable collectibles, or furniture. This basic coverage will not provide enough money to replace any expensive items that movers may damage during a move.

For instance, you may decide to move to a loft within the city. You may hire a moving company that damages your $2,000 smart fridge when transporting it to your new place. Now, your appliance doesn’t cool down, even when it’s turned on.

If you selected released value protection coverage, the company wouldn’t fully reimburse you for your damaged fridge. Instead, they would use the weight to calculate the replacement costs. If your fridge weighs 600 pounds, you’ll only receive $360 to replace your fridge.

Your precious household goods cost more than the 60 cents per pound a moving company may offer. If you need better coverage for your valuables, you can select different options that provide better protection.

What Is Full Value Protection Moving Insurance?

A second option that provides increased coverage for your belongings is full value protection. Federal laws also mandate moving companies to offer this insurance to customers during interstate moves to a new city.

Full value protection is not free, but it provides comprehensive full coverage. It means that the moving companies are liable for the full replacement of any valuables they transport to another long-distance location. These policies allow the consumer to determine what their items are worth per pound. This is stated liability, where you set the limits for your moving company’s liability. You’ll pay a premium based on the total amount of coverage for lost, destroyed, or damaged belongings.

Moving companies usually offer their own full value protection policies. They will cover the minimum value that you claim on your goods. Some state laws mandate the minimum level of coverage for household items. These amounts average between $4 and $6 per pound for household goods.

How Full Value Protection Works

How does your moving company calculate full value protection? They multiply the total declared load by the minimum coverage value. For example, if your total declared load is 30,000 pounds, and your state’s minimum coverage is $4, then the moving company will value your goods at $120,000. This figure is the maximum amount you’ll receive if the insurance company loses or damages your entire shipment.

You may be responsible for other costs besides your premiums. Some full value protection policies require policyholders to meet a deductible. These are out-of-pocket costs you must pay before the moving insurance covers your items.

Although you must pay for full value protection, this coverage is well worth the price. Experts recommend buying this coverage because it will pay for the current market replacement value of damaged goods. It will also pay for repairs or replace your items with similar ones.

How to File a Claim With Full Value Protection Moving Insurance

When you file a claim under a full value protection policy, your moving company will have three options to fulfill your claim.

  • Repair your valuables
  • Replace your items with full-replacement value for your item with one of comparable value
  • Pay out full-replacement value for repair costs or the current market value of the item

The moving company, not the customer, decides how they’ll make amends for the property. They can either repair the item or have it replaced with a similar item. Interstate shipments transported under the mover’s bill of lading are subject to an arbitration process. It occurs when you dispute the valuation of lost or damaged items.

For example, a professional moving company could damage your 400-pound washing machine during a move. Once you submit a claim and the company approves it, you may receive another washing machine at the current market value. If your washer was already beaten up, they won’t replace it with a brand-new washer. Instead, they’ll pay you the fair market value. You may have to pay a deductible of between $250 and $1,000 before the moving company will pay your claim.

Pro Tip for Moving Insurance:

Undergo the arbitration process if you dispute the moving company’s valuation of a damaged item.

Getting Full Value Protection for High-Value Items

Moving companies can limit their liability for high-value items under these policies. The Surface Transportation Board refers to them as “items of extraordinary value” since they are worth more than $100 per pound. They include jewelry, antiques, valuable art, and other items.

Movers don’t have to reimburse you for items worth more than $100 per pound unless you listed them in its shipping contract. For instance, if they lose your diamond necklace during transport, they won’t have to cover it unless it’s listed on the shipping manifest.

Moving companies will allow you to buy more coverage for these items. The premiums will depend on the value of each item. Make sure you inventory your belongings and list everything valued at $100 or higher. Ask your moving company’s representative to include these items on the manifest.

Pro Tip for Moving Insurance:

Make sure the moving company lists your high-value items to ensure they’re covered.

What Is Separate Liability Insurance?

You can ‌upgrade your coverage if your valuables have increased exposures and risks. If valuation insurance doesn’t provide enough insurance, you can consider separate liability. This coverage will provide extra protection for your items.

Separate liability is an optional, third-party cargo liability insurance regulated by states. You may buy this coverage through the moving company. The policy covers the insurance amount purchased minus the basic carrier liability amount that movers pay (usually 60 cents per pound).

Under federal law, the moving company must provide you with a copy of the insurance policy after you buy it. They must abide by this legal provision. If they break the law, the moving company is liable for all claims, losses, and damages attributed to their negligence.

Third-party insurers follow the regulations of the local states where they operate. You can’t enter an arbitration process if you dispute the value of an item listed on an estimated settlement.

Pro Tip for Moving Insurance:

Get a copy of your third-party moving Insurance policy after you buy it.

What Is Expanded Moving Insurance Coverage?

If you expect your shipment to face increased risks during shipment, ‌consider upgrading your coverage.

There are several options available to customers. Some companies sell expanded valuations. You can buy declared value protection, and this coverage allows you to set a per-pound amount for your valuables.

For instance, you may determine that your household goods are worth $7 per pound. If your total shipment is 20,000 pounds, you have estimated your goods are worth $140,000. This amount is the maximum you would receive if your movers lost your entire shipment.

They would replace individual items, like clothes or appliances, with like-kind ones. The moving company would replace a five-year-old dryer with a similar model. Clothing would have little cash value, so they would replace it with similar items.

Pro Tip for Moving Insurance:

Ask the moving company to provide a lump sum, or assessed value, for the shipment. It provides similar coverage, except the customer determines the shipment’s value instead of determining it by its weight.

Moving Insurance Doesn’t Cover Everything

Although valuation coverage reimburses customers for damages, these policies don’t cover everything. There are several scenarios that valuation insurance will not cover.

  • Self-packed items — Movers are not liable for items you packed yourself. Unless the box has significant damage, this coverage will not reimburse you for these broken items.
  • Natural disasters — Valuation insurance will not protect you if a natural disaster damages the shipment. These disasters include fires, hurricanes, tornadoes, windstorms, and hail.
  • Storage facilities — Moving companies don’t pay for items damaged in self-storage. You can buy a policy directly from the facility to cover these goods.

Negligent Acts That Can Reduce the Moving Company’s Liability

Even though you’ve purchased insurance to protect your items, this coverage has its limits. Several situations can reduce your mover’s liability for losses and damages to your household goods. They include:

  • Intentional acts that cause damage to your items
  • Omissions about damaged or lost items
  • Declarations of a shipment value that is worth less than the stated amount
  • Failure to declare items that are worth more than $100 per pound

How Can I Select the Right Valuation Coverage for Me?

Are you uncertain about which moving insurance is right for you? In this section, we’ll discuss a process that will help you determine which coverage can provide you with the right protection.

Step One: Calculate the Total Worth of Your Belongings

Before buying insurance, you must calculate the total value of your belongings so you can select the right coverage. During the first step, you’ll take a comprehensive inventory of all belongings. It should list all items, including your cookware, clothing, furniture, art, appliances, and other goods.

When documenting your items, note any damage. Consider videoing your items or taking time-stamped pictures with your phone. These should be clear photographs of your valuables. You can upload them to your cloud service. Other free options include Google Drive, Pinterest, or Facebook.

Label and chronicle each photo. If possible, estimate the relative market value for each one and save these values in a spreadsheet document. After you itemize all of your valuables, calculate their total value. Once you determine their cost, decide which coverage can better protect your goods. You can select either released value or full value protection.

Taking pictures of your valuables can also provide additional benefits. If the moving company loses or damages your items, these pictures will provide proof of their condition when you submit a claim.

Even though this process is time-consuming, it provides significant benefits‌.

Step Two: Determine If Released Value Protection Will Provide Enough Coverage

Before you select this coverage, estimate the total weight of your household goods. For example, you may believe that your valuables weigh 20,000 pounds in total. If you select released value coverage, the insurance company will only pay 60 cents for these goods.

It means you’ll only get $12,000 in total for all your belongings‌. If your goods are worth less than this amount, released value insurance may be your best bet.

Step Three: Determine if Full Value Protection Is Worth the Price

After you finish your inventory, you may have valued your items at $50,000. If so, you probably determined that $12,000 of released valuation won’t provide enough coverage for your household goods. If this is the case, you should select full value protection insurance. This coverage may be worth the extra price, even if you have a higher premium and a $1,500 deductible.

Step Four: Get Extra Coverage for Items of Extraordinary Value

If you have high-value goods that are worth more than $100 per pound, you may purchase extra coverage. List each high-value good within the shipping manifest so that the movers will cover any lost, damaged, or stolen items.

Step Five: Review Your Contract to Learn What Moving Insurance Your Mover Offers

The Federal Motor Carrier Safety Administration is a government agency that oversees interstate moves. It recommends customers learn about moving insurance options before signing a bill of lading contract and hiring a moving company.

A bill of lading is a legal contract between you and the moving company. It ensures the movers will pick up, transport, and deliver your household goods to your new place.

By federal law, companies must give estimates to customers for every interstate shipment. During a consultation, your moving company will provide you with an estimate. They will also review their insurance coverage options. Here are three things to keep in mind before signing your contract:

  • Review your moving company estimate. Your mover should list the estimate type in the first section of your contract. It determines how the movers will calculate charges for your shipment.
  • Examine your liability coverage contract for any discrepancies, mistakes, or missing information.
  • The FMCSA says customers should never sign a blank moving estimate form.

The Responsibilities of Consumers During the Moving Process

Do you understand your duties as a consumer? During interstate moves, customers have five responsibilities under federal law:

  1. Read all moving documents and contracts provided by a mover or broker.
  2. Be present when the movers pick up and move your valuables. If you can’t be there, have a representative present to act on your behalf.
  3. Notify the movers if something has changed in your shipment. For instance, tell them if you need to change the move date or add other valuables.
  4. Pay the amount the moving company has required.
  5. Immediately file claims for any lost, damaged, or stolen items.

Homeowners and Renters Insurance May Provide Some Coverage for Do-It-Yourself Moves

Some people try to cut their moving costs with a do-it-yourself move. They pack their own valuables and move to their new home with the help of friends or family members. Even if you handle a move on your own, you still need the right coverage to protect any lost, damaged, or destroyed household goods during a move.

Before moving, contact your local insurance agent if you have either a homeowners insurance policy or renters insurance policy. You can ask if these policies will cover any lost, stolen, or damaged items. Typically, insurers only cover ten percent of your belongings’ value during a do-it-yourself move. You can also ask your insurer if they sell relocation insurance. This is similar to declared value and lump sum insurance policies.

Ask what your auto insurance covers during a do-it-yourself move. Generally, these policies won’t provide you with any protection. You must assume the risk for your items if you use your own vehicle.

Renting a truck for your move may be a better option. Your auto policy’s comprehensive and collision coverage won’t transfer to commercial rental moving trucks during a move, but you can get optional collision waiver damage from the rental company. Additionally, these businesses offer insurance that protects the rental moving truck, driver, passengers, or cargo, depending on your coverage.

You can also consider buying total loss coverage from your insurance company to protect yourself during a move. It will protect your belongings if a natural catastrophe, fire, or accident damages them. It is the only coverage that will cover the total loss of your belongings.

Additional Moving Insurance Options for Do-It-Yourself Moves

Couple looking at their moving insurance policies before a DIY move

Are you handling your upcoming move yourself? If so, speak with your insurance agent and ask about several rider policies for do-it-yourself moves. You can tack on this coverage to your homeowners or renters insurance to protect your valuable items. There are five policies you can consider:

1. Trip Transit Insurance

This coverage pays for lost, damaged, or stolen items during a move. It also covers household goods that you place into storage. Private insurers provide these policies for homeowners and renters insurance policyholders. They typically cover do-it-yourself moves. Professional movers offer it as an excess coverage type since moving insurance may not cover items during transit. Like other policies, trip transit insurance won’t pay for items damaged in storage facilities. It also doesn’t cover goods damaged during natural disasters.

2. Floater Policies

These policies protect expensive items such as collectibles, jewelry, antiques, and valuable art.

3. Special Perils Content Coverage

This insurance will pay for items broken during transit. It doesn’t pay for fragile objects.

4. Storage Unit Insurance

You can consider getting this coverage for an additional $20 a month to protect your items in case of theft, floods, fires, or other natural disasters.

5. Car Insurance Verification

If you’re shipping a vehicle to your new place, you can ask the company that’s managing your auto shipment for their insurance certificate. The law requires shipping companies to provide this documentation. Next, call your insurance company to find out if your policy will cover your car once it’s transported.

Submitting a Claim to a Moving Insurance Company

Have you finished moving into your new place? If so, there are several tips to keep in mind when filing a moving insurance claim.

  1. Check your belongings for any damaged or lost goods after you move in. Complete this process as soon as you move because many moving companies have a limited time frame for submitting a claim. If you wait too long, you could lose your opportunity to file.
  2. Search for missing items before submitting a claim. If you notice an item is missing, look through boxes to see if it’s in a mislabeled box. If you can’t locate it after searching for it, then file a claim.
  3. Submit your claim immediately after searching. This step will ensure that your moving company will process it quickly. Add any proof to verify your claim, including before and after pictures, videos, and receipts.

Once you finish unpacking, you can finally settle down and relax in your new place. When everything’s in order, take a few moments and introduce yourself to your new neighbors or have a housewarming party.

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