Do I Need Insurance When I Move?
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If you hire a moving company to transport your belongings, they will offer some level of basic liability coverage in case they damage your belongings. However, the coverage is limited and won’t cover other types of losses like those caused by fire or theft. Fortunately, you can buy additional coverage or a third-party insurance policy to insure your belongings more comprehensively.
Learn how moving insurance works as well as how to navigate the nuances of different coverage options and the claims process.
What Is Moving Insurance?
Moving insurance commonly refers to a type of coverage offered by a moving insurance company that protects your personal belongings during a move. Unlike traditional home insurance, which covers your possessions in your home, moving insurance specifically covers loss or damage that occurs while your items are being packed, transported, or stored during the relocation process.
How Does Moving Insurance Work?
Despite the name, the moving insurance coverage provided by moving companies isn’t actually insurance, as moving companies are not licensed underwriters. Rather, moving companies are required by federal law to offer “valuation coverage.” Depending on how much coverage you buy, it will reimburse you for either a portion of or the complete value of your belongings if they are damaged while in the moving company’s care.
Keep in mind that you may need to pay a deductible, which is your out-of-pocket expense before your valuation coverage starts contributing to your losses.
Types of Moving Insurance if You Hire a Moving Company
If you hire a moving company, they will either insure your personal belongings via released-value protection or full-value protection. Alternatively, you can buy an insurance policy through a third party.
Released-value protection (RVP) is a cost-free but limited coverage provided by movers that limits the mover's liability to just 60 cents per pound per article. For instance, if the moving company loses or damages a 10-pound piece of furniture, you would be compensated for $6 ($0.60 x 10 pounds).
Full-value protection (FVP) is an extra cost but it will provide far greater coverage than the RVP included with your moving contract. If any of your covered items are damaged or lost, the moving company must agree to one of the following three solutions:
- Repair the item
- Replace it with a comparable item
- Pay for the cost of repairing it or its current market value
Alternatively, you can buy an actual insurance policy from a third party, which will usually provide more comprehensive coverage than the valuation coverage provided by a moving company. For example, a moving company may only cover damages incurred by the movers but not against external perils like theft or fire. A third-party insurance policy can plug these coverage gaps. This type of policy is sometimes sold as trip transit insurance.
Keep in mind that if they can be held liable, your moving company is still required to reimburse you for at least 60 cents per pound per article even if you buy third-party insurance. After this reimbursement is fulfilled, your third-party insurance will contribute to your losses up to however much coverage you buy.
Using our 10-pound piece of furniture example from earlier, let’s say it was valued at $200. The moving company would reimburse you for $6 and the moving company can cover the remaining $194 if you buy enough coverage.
Types of Moving Insurance if You Move Yourself
If you’re handling the moving yourself, you can buy either a third party insurance policy or get coverage through the rental truck if you plan on using one.
As already discussed above, third-party insurance or trip transit insurance is one option you can consider if you are moving yourself. The only difference is that there is no moving company that will cover the first 60 cents per pound per article and the third-party policy will serve as primary coverage for your belongings during the move.
Rental Truck Insurance
If you’re renting a truck to transport your items, it may be possible to buy insurance for the items loaded on the truck during the move. Keep in mind that there will be a limit on how much of your items will be covered and you will usually need to pay a deductible. In addition, coverage may not extend to when items are being loaded or unloaded and is only active when the items are already stored on the rental truck.
What Will Moving Insurance Not Cover?
The coverage provided by a moving company is a type of liability coverage, meaning that your belongings are covered if it is damaged while being professionally packed or transported.
That said, some moving companies may even exclude coverage during transit and will only insure your items while it is being packed by the movers. You should always double-check your contract or you may go without coverage while your valuables are on the road.
In addition, your moving company may list items that will be excluded from coverage so it’s important to read your contract before signing it. For example, TSI Shipping will not cover the below items:
- Most forms of currency including cash, checks, money orders, gift cards and coins
- Stamp collections
- Sports memorabilia
- Gemstones and precious metals
- Jewelry and watches
- Hazardous materials
- Stone slabs
- Flowers, plants and seeds
- Flowers, plants and seeds
- Windows and glass
- Electronics such as computers, televisions, laptops and cell phones
When Do You Need Moving Insurance?
Standard homeowners insurance may not cover your items while you are moving even if you have off-premises coverage so you will need to buy moving insurance to ensure they’re covered during the relocation process.
The value of your belongings will be a large determinant of whether or not you should buy moving or relocation insurance. If it would cost a lot to replace your belongings if they are damaged during the move, then moving insurance can be worth the added cost. If you’re a first-time homebuyer and don’t have much stuff to transport, then moving insurance may not be necessary.
The distance of the move is another consideration. If you’re moving your items across long distances — across state lines, for instance — then there is a higher likelihood of your items being damaged during the drive or even targeted while you are at a rest stop. In this case, moving insurance is strongly recommended.
How Much Does Moving Insurance Cost?
Released-value protection is already included when you hire movers so it will not cost extra but upgrading to full-value protection will typically cost 1% to 2% of your property’s value. Meanwhile, buying a third-party moving insurance policy will generally cost around 1% to 5% of the shipment’s value or $1.25 per pound of the property being transported.
Depending on what type of coverage you buy, you could be paying $200 to $1,250 to ship a 1,000-pound haul of your belongings valued at $20,000.
*Rates can vary by company
What Do I Need To File a Moving Insurance Claim?
After accepting the delivery, you should take pictures of the condition of the boxes and do your best to inspect the contents as soon as possible because some companies enforce deadlines for when you can file a claim. If anything is damaged, document them with pictures or videos and notify the moving company or insurance company.
Similar to filing a homeowners insurance claim, the moving company may ask you to provide other documentation such as receipts to demonstrate proof of value. If your claim is accepted, you will be reimbursed up to your coverage limits, minus your deductible.
How To Switch Insurance Companies When Moving Out of State
We’ve broken down how to get insurance once you’ve moved out of state.
- Contact your current provider. Ask if they offer coverage in your new state or if they can recommend a partner company. This could simplify the transition and possibly retain some benefits from your current policy.
- Research new insurance providers if you can’t keep your old carrier. Compare their policies, coverage options and premiums. Check customer reviews and ratings to gauge their service quality and reliability.
- Get quotes and compare. Obtain quotes from several companies in your new location. Compare these quotes not just on price but also on coverage details, deductibles and any additional benefits or discounts they offer.
- Update your address and information. Verify that your changes are accurate and reflect your new living situation.
- Cancel your old policy. Ensure that there's no gap between the end of your old policy and the start of your new one to avoid being uninsured during the transition.
- Keep records. This includes all communications, policy documents and confirmations. These records are important for reference and in case of any disputes or questions about your coverage.
- Review your new policy. Make sure you understand the coverage, any exclusions and your responsibilities. This understanding is vital to ensure that your new insurance meets your needs and expectations.