If you’re moving, whether it’s across the street or a relocation to another country, you most likely want your belongings to arrive in one piece at your destination. When it comes to insuring the value of your goods during a move, there are two options available: insurance and valuation.
What’s the Difference?
Valuation is the amount of liability that the moving company will accept for having your goods in their possession. The limit of such liability is the same as the moving company’s own coverage. In many cases, this amounts to as little as the government-mandated $0.60 per pound of material. This is one of the questions you should ask when hiring a moving company.
Moving insurance involves an agreement between the insurance company and the person moving. This agreement states that the insurance company will pay out a prearranged amount based on the true value of the goods in question in exchange for a fee, monthly or otherwise.
What Else Do I Need to Know?
The world of moving insurance is more complex than just calling up the company and saying, “Yeah, the movers broke my item.” For example, there might be a deductible, which is the amount of the value of the damaged goods for which the insured person accepts responsibility. For example, let’s say the damaged item is worth $1,000 and that the deductible is $300. That means that the insurance company will cover $700 worth of the item, and the insured person will accept a hit of $300.
There are other considerations, such as “all risk insurance,” “total loss insurance,” and “named perils” insurance, just to name a few. What does each of these mean?
- All risk – covers individual items up to the amount stipulated in the policy from everything except that which is excluded by the policy.
- Total loss – covers the loss of everything but not individual items
- Named perils – covers items lost in a specific set of circumstances
Each has its advantages and disadvantages. If you purchase “named perils” insurance, for example, and include loss by fire but not flood waters, you wouldn’t be covered if a flood washed away the moving van. If you purchase total loss insurance, and a water leak in the van ruins your antique desk, the coverage wouldn’t apply because it wasn’t the entire load that got damaged. There is a variety of different options, each with different costs and benefits, so it would behoove you to speak with a licensed insurance broker to get a full accounting of all your coverage options.
Is Moving Insurance Really “Worth It”?
In short, yes, moving insurance is worth it. Remember, the government only says that the moving company must pay you $0.60 per pound in the event of a loss. That might not be so bad if your load consists of 20 pieces of furniture that weigh 2 tons, but it would be a disaster if you had a priceless collection of unframed lithographs that only came to 3 pounds.
If you’re already researching the costs of moving insurance, but haven’t yet found your movers, kudos to you for your stellar planning. Now, let us suggest some great moving companies (greatguyslongdistancemovers.com) that are both licensed and insured (at least the minimums required).