How much moving insurance, and what kind, should you get to cover your possessions in case they are damaged, stolen or lost in transit? It depends on the value of what you're shipping, your budget and your comfort level.
For starters moving liability coverage for interstate moving is not the same as insurance policies, which are regulated by state insurance laws. Some moving companies also offer separate insurance policies, where the insurance carrier, not the mover, pays for certain claims.
Whatever level of moving insurance you choose be sure to place a sufficient value on your belongings before you move.
Four levels of liability:
- Released value or basic liability: This protection doesn't cost extra, however the mover is liable for no more than about 60 cents per pound, per item.
- Declared value: Valuation is based on total weight of your shipment multiplied by about $1.25 per pound. Claims are settled based on depreciated value of the lost or damaged article up to the maximum value for the whole shipment. The mover is allowed to charge you about $7 per $1,000 of liability coverage.
- Lump-sum value: Similar to declared value, but you can raise the total value of the shipment to what you think is accurate. This option also costs about $7 per $1,000 of valuation.
- Full replacement value: This type of insurance covers repair or replacement with like items at current market value, not a depreciated amount based on age of the item. Cost for this option varies, and you can decide whether to reduce the cost by paying a deductible. You can choose full replacement coverage for all your belongings, or declare a somewhat lesser value as the chances of the entire shipment being destroyed are pretty low.
More valuable items: If you plan on moving fine art, valuable collections, or antiques, you should consider coverage of "high-value articles," a term for any item worth more than $100 per pound. You must list and value these separately in your contract or the mover's liability for damages will be limited. Consult your homeowner's insurance policy. Some policies cover special items in transit under an "all perils" clause.
File a successful moving insurance claim
Statistics show that more people file a small claim than a large claim. If you move interstate, claims are handled through a federal claim and arbitration program. But if you move within a state, rules differ and most disputes are handled by a state agency or the state attorney general's office.
Filing and settling under the federal liability program:
- You must file a claim with your mover for loss or damage within nine months.
- The mover must acknowledge receipt of your claim within 30 days of its being reported. Be sure to report damage promptly. It’s important to note the problem on the moving van driver's copy of the inventory before signing it.
- Within 120 days of receiving your claim, the mover must either deny it or make an offer to pay.