How Much Insurance Should You Buy When Relocating to a New Address?

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Depending on where you plan to move to, buying extra insurance may make sense. When people begin to plan their move they don’t consider moving insurance because they assume they can go without it. They usually assume that the moving company will cover the costs of anything that is broken, lost, or stolen. However, that might not always be the case. Many also believe that even if the mover fails to cover losses, their homeowners or renter’s insurance will reimburse them. Although both kinds of insurance can cover part of your losses, it’s still a good idea to consider added insurance. But just how much insurance should you buy? Our team at Royal Moving & Storage is here to provide you with answers!

Before deciding how much insurance should you buy, check the contract details

Moving companies do offer a certain amount of coverage that is part of the moving service they provide to you. Be that as it may, it’s a good idea to look closely at your moving contract and check its content. Take your time to understand completely what it covers and what you will have to pay for. It may come as a surprise that, as part of your contract, movers provide a valuation.

glasses on insurance policy papers
Different valuation types dictate how much insurance you should buy

This is a fixed amount of money that will be paid for your property in case of loss or damage. Do keep in mind that valuation is not insurance. The mover pays evaluation only in case they directly caused an issue. With that in mind, valuation doesn’t cover external factors. There are three kinds of valuation protection that movers offer:

  • Complete value protection;
  • Assessed value protection;
  • Weight-based value protection.

Each valuation functions differently, so you’ll want to read through all of them. Doing so can help you make a decision when choosing a mover and deciding whether or not to get extra insurance. Now, let’s see how they function in more detail. 

Complete Value Protection is a well-rounded solution

This valuation coverage is one of the better ones offered by moving firms. Just keep in mind that it doesn’t cover everything. This offer covers property that is damaged, destroyed, or lost in transit. It can pay for replacement or repairs of your property. But be aware that there are usually deductibles and minimum coverage amounts. The name may lead you to believe that your items have full coverage. However, you’ll soon find that you cannot collect as much as you might have thought initially.

Assessed Value Protection works well for valuable items

You may want to opt for this kind of protection if your property doesn’t weigh much and is worth a lot of money. Essentially, you can purchase coverage for a set fee per $1,000 worth of your property’s value. Assessed value can be a good addition when using professional packing services. Do keep in mind that your bill of laden must clearly list the coverage. Otherwise, the mover isn’t under obligation to cover you.

moving box labeled fragile
Calculate how much insurance should you buy if you have fragile items to move

Declared Value Protection Based on Weight is suitable for large relocations

In the case of this coverage, the mover will multiply the total weight of your property by a fixed amount of money and that will equal the coverage offered to you. If your property weighs 20,000 pounds and the fixed amount per pound is $3, the mover is liable for $60,000 if your property is lost or destroyed. The depreciated value of your property determines how much you will receive in a settlement.

Transit damage is a good cause to buy insurance

It’s good to be aware that many moving contracts state that the mover is not responsible for damages that occurred during transit. If, for instance, a heavy carton packed with your property tips over and damages another piece of your property, you would not be eligible for reimbursement. That is the case even if the damage occurs because the boxes are not packed well in the van, or if the content shifts during transport. Some moving firm’s contracts also state that the company is not responsible for damages that occur if you packed your property yourself rather than hiring the movers to do it.

Corporate relocations always need an added layer of insurance

If you’ve hired a team of office movers in Los Angeles to move your business property, you have to double-check if your property has protection. It’s important to get your contract number as well as a copy of the contract that you signed with the relocation firm. Based on the details, you can deduce how much insurance you should buy for your corporate relocation. Do keep in mind that some moving companies can offer both valuation and full insurance. Make sure to check the details with their representative in advance.

red moving truck carrying items
Your items are most vulnerable while in transit

Homeowners and Renter’s Policies

So, you have chosen the moving services in Los Angeles you require. Through your moving contract, you’ve pinpointed exactly how much valuation coverage you’ll have in the move. The next step is to find out what coverage, if any, you have from your homeowners or renter’s insurance policies. Your best source of information is an insurance agent who handles your homeowners or renter’s policy. You’ll need to ask them if you have any coverage for moving, and if so, how much.

Usually, homeowners’ or renter’s policy covers only about 10 percent of the value of your property during the relocation. In this case, it may be a good idea to consider purchasing additional moving insurance. Insurance covers your property during loading into the truck, during transport, and while unloading at your new home. Remember, much of the damage that could occur would take place during these critical phases of the operation.

Consult a Professional on How Much Insurance Should You Buy

There are a variety of different kinds of moving insurance you can buy, but many opt for an additional insurance policy known as “Goods in Transit”. While many moving companies can sell you this kind of insurance, you may want to check with your insurance agent before making any purchases. Your agent can help you figure out whether or not you need additional insurance and may be able to point out which moving companies offer the best coverage. Some simple rules of thumb apply when deciding if you need additional insurance, and how much additional insurance you ought to buy.

man and woman high fiving
Your moving broker can help you buy the right kind of insurance

Basic liability insurance covers somewhere from 30 – 60 cents per pound. If you have booked furniture movers in Los Angeles who are transporting pieces of antique furnishings that are worth thousands of dollars, you will obviously need greater coverage than what basic liability insurance provides. If instead, you opt for declared value protection you can set the value of your property yourself. However, if those items are lost, damaged, or stolen in transit, you’ll likely need documentation from an outside appraiser or receipts to support your claim for your property’s true value.

Replacement vs. Actual Cash Value

After consulting with your broker, there is one last matter to settle. And that is whether to choose RCV or ACV coverage for your home. They’re both certainly beneficial but work in different ways. Should you choose replacement value coverage, if your property is lost or destroyed you will receive the cost of replacing the item with a new one. If instead, you choose actual cash value insurance, you will receive reimbursement for the property’s depreciated value. So, items that are five years old, for instance, will mean that you’ll receive less for those items than if they were brand new.

So, be sure to choose carefully if, how much insurance should you buy, and of what type. Don’t forget to check with your mover to determine how much coverage your package includes. Then, consult with your insurance professional and determine whether or not the value of your property needs any additional coverage. The decision you make could make a great difference to you in the long run.

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