By Relocation.com Staff
The good news about moving protection for your belongings: Moving companies offer some coverage for free.
The bad news: If they drop your new liquid plasma TV, the payment you get from the mover will barely buy you a few TV dinners.
There's basically four types of ways to protect your move:
- Accept the "limited liability" coverage provided by your mover – it's free, but it doesn't provide much protection.
- Pay a bit more and get a higher level of protection through your mover, known as "full-value replacement protection."
- Buy an insurance policy through a third-party insurer.
- Rely on any coverage you might have from your homeowners insurance company (but do NOT assume you're automatically covered).
First things first: movers provide 'valuation' protection, not insurance. Valuation and insurance operate similar to one another, but with a key difference: valuation protection is governed by federal requirements, while insurance you buy is regulated by your state. Also, the protection levels vary between valuation and insurance, as does the cost.
This article mostly concerns interstate moves, which are governed by the federal government. You'll find largely similar options for your in-state move, although they can differ a bit state to state.
Most importantly, moving companies are required to explain to you your protection options – if they don't or won't, find another moving company.
1. Limited Liability:
This is technically known as "basic carrier liability-release value" and is the minimum required by federal law.
This is covered in your base move price and does not cost you any extra money. As such, it is the most economical option available, but your goods are often covered to no more than 30-60 cents per pound per article. This minimal amount of coverage is called "released value" or "carrier's liability."
For in-state moves, the amount of liability will vary depending on how the state regulations are structured, but it's often 30 cents a pound. For interstate moves it is 60 cents per pound per article. So, if you're using a long-distance mover and your 20-pound TV is destroyed in transit, you would be entitled to $12.00 for the replacement of the TV.
Obviously this will not replace the TV, so think carefully before agreeing to this level of coverage. If you agree to this option for the protection of the furnishings and boxes in your shipment you will be asked to sign a statement of agreement on the Bill of Lading (which is the document that releases your goods to the mover).
2. Full-Value Replacement Protection:
With this plan, any goods lost, damaged or destroyed during the move will either be repaired, replaced, or a cash settlement made at the mover's discretion.
This is the most comprehensive insurance plan available for the protection of your goods while in transit. Costs vary depending on the mover, but choosing a higher deductible can lower the cost.
Also, the mover can protect himself from loss or damage to high-value items, which is generally items with an individual value of over $100 per pound, unless you list these goods on the shipping document. Most movers, as noted under "Extra Ordinary Value Items" section below, provide you with a high-value inventory sheet on which you can list these items. Be sure to do so.
3. Buying a Third-Party Insurance Policy:
Your moving company might offer an insurance policy through an insurance carrier, or you can seek quotes on your own. USInsurance.com offers free quotes for what you might pay – it's generally pretty cheap, often below one percent of the value of your goods.
4. Rely on Your Homeowners Insurance Policy:
Some homeowner's insurance policies cover household goods fully or partially while in transit, so check with your agent to see if and how you are covered – you might not be covered for certain types of damages and you'll probably be limited in your coverage.
You also might not want any claims for moving damage to have an effect on your homeowners insurance policy, in which case a separate insurance policy for your move might make sense.
Other Options to Consider
Extra Ordinary Value Items:
Items in your shipment with a value greater than $100 per pound per article are considered has having "high" or "extraordinary value." You must advise your van line agent in writing that they are in your shipment to be considered for replacement value protection. Examples might include antiques, currency, cameras, video cameras, jewelry, collectibles, furs, and oriental rugs etc. Check with your mover about the terms and conditions and written declaration required for this level of protection.
Moving in State -- Another Option:
In some states, Declared Value Protection is available for intrastate/local moves. This coverage is based on depreciated value of an item regardless of current replacement cost. The whole shipment is covered at a value not to exceed the dollar amount that you, the customer, declare to the moving company.
With this option, the mover assumes liability for the entire shipment at an amount equal to 1.25 times the weight, or whatever the given amount is in a particular state, of your shipment.
For example, if your shipment weighs 8,000 pounds, the mover will be liable for loss or damage up to $10,000. Though you have made no specific arrangements for this plan, you may automatically default to it, if you have not chosen another option. Again, this is subject to an individual state's regulations. The mover is entitled to charge you for this protection.
Prices will vary; however, it will probably be around $7.00 for each $1,000 of liability assumed, In the case of a shipment weighing 8,000 pounds and a minimum declared value of $10,000 a charge of $70 will be added to your bill for the additional protection.
Some states may require a minimum amount of coverage or so much per pound, whichever is greater.
Under this arrangement, if a 20-pound item with a replacement value of at $1,000 is damaged, but it is three years old, the mover is liable for the damage based on the replacement cost less three years depreciation. The normal depreciation is around 10 percent per year. Your valuables are somewhat protected under this plan, but you pay for it. The cost will, most likely, not be that much less than full-value replacement protection, so the full-value replacement protection is probably still the best option to choose.
Ask your mover for additional charges and rules.
DIY Moving Options:
Consumers who choose one of the do-it-yourself moving options put their possessions in the greatest jeopardy. Equipment rental insurance and homeowner's policies may cover some catastrophic losses but both have limited application and well-defined exclusions. Basically – if you bend it, bust it, break it, or burn it – you buy it. Read the fine print and then ask specifically about insurance claims.
How to Make a Claim:
In the unlikely event you have loss or damage as a result of your move, you have nine months to make a claim on interstate moves. The time period may be different for intrastate/local moves. Again, it depends on the regulations in a particular state. Even if you have a claim, you are still responsible for paying for the move in a timely fashion. This is usually cash on delivery on the day of unloading or, if using a credit, a few days prior to the loading of your shipment.
There are rules and regulations for the time in which the mover is required to respond to your claim and the time when the issue must be resolved. In the event you and the moving company cannot come to terms and arbitration is chosen to resolve the issue and you are not satisfied with the outcome of the arbitration process, you may sue for damages. Check with the local Better Business Bureau to get information on how the mover has handled claims in the past.
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