Having moving insurance is vital to protect your household goods when moving overseas or practically anywhere. Last week, I provided you tips on how to negotiate but noted, not to skimp on not purchasing insurance. This week, the ins and outs and tips to purchasing insurance.
Here are some important tips you should know about insuring your belongings during a move:
Federal regulations require that all moving companies offer two types of coverage to consumers on out-of-state moves.
• Released-value protection covers up to 60 cents per pound. This protection is standard and included in moving charges.
• Full-value protection covers the value of the entire item damaged, and is based on the customer’s valuation of the goods that are being moved. The customer pays about 1 percent of the valuation for the added coverage. If you decide all of your belongings being shipped are worth $50,000, you would pay about $500 for full-value protection.
Expanded Mover Coverage
• Valuation options: You can ask moving companies or a third party if they offer other valuation options, often called “assessed value protection”, that cover damage beyond the “up to 60 cents” coverage movers supply by law.
• Expanded valuations: Declared value allows you to set a per-pound amount for your belongings. For example, if you decide your belongings are worth $6 per pound and your total shipment is 10,000 pounds, you are placing a valuation of $60,000 on the total shipment. That would be the maximum you would receive if the entire shipment were destroyed or lost. Individual items would be replaced with like-kind, a two-year-old washing machine for a two-year-old washing machine. This is important to consider because items such as used clothing have little actual cash value.
• Lump sum value: Also called assessed value, this coverage is basically the same as expanded valuations, except the consumer sets the amount by value instead of weight. This is better if you have a lot of small, high-value items that don’t weigh much.
Whichever insurance you choose, make sure to inspect your goods when they arrive at their destination so you know all your household goods are in great shape.