Moving insurance pays for repairs or replaces your property if it’s damaged while being moved or transported by a moving company. Although you aren’t legally required to purchase moving insurance, it can be a good idea to invest in a policy if you’re moving expensive or precious items that can be expensive to replace.
Basic Moving Insurance Coverage
All moving companies are required by federal regulations to offer two types of coverage to consumers on out-of-state moves.
The first type of coverage is ‘released value protection. This coverage is set at $0.60 per pound. This means that if your items are lost or damaged, you can be reimbursed for everything from hair clips to large furniture at a rate of $.60 per pound. This type of coverage is included automatically in any quotes you receive from a reputable moving company. However, you’re probably thinking to yourself, my belongings are worth a lot more than 60 cents per pound.
For this reason, long-distance movers also offer what’s called ‘full-value protection. This type of coverage is based on the value of the contents being transported and can range from between 1%-2% of that value. For example, if your items are worth $75,000, you would pay around $750 for full-value coverage of those items. Alternatively, if you are making a smaller move, and your items are only valued at around $10,000, you would pay $100 for full value coverage.
Released Value vs. Full Value Protection
When you file a claim under full value protection, there are three options for satisfying your claim. They include repairing the item, replacing the item with another of comparable value, or making a payout for the cost of the repair or the current market value of the item.
For example, if your 200-pound sofa is damaged beyond repair during a move, the type of insurance you carry will determine what kind of claim and reimbursement you will be entitled to. With Released Value protection, at $0.60 per pound, you would only be eligible for a $120 claim. Alternatively, with Full Value Protection, you’re able to claim the value of the sofa, which could be significantly higher than $120.
In many cases, though, you will have to pay a deductible of $250-$1,000 before the moving company satisfies your claim. In contrast, there are no deductibles under released value protection, and after making a claim, you would simply receive compensation for 60 cents per pound of the item damaged.
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