January 20, 2022

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Does home insurance cover personal belongings?

Guaranteed insurability rider considerations | Protective Life

When calamities such as storm, flooding, and fire, strike a home, your personal belongings ends up being affected. Clothes could have been damaged irreparably by smoke due to fire. On the other hand, burglaries could have caused the loss of valuable belongings. Homeowners insurance companies offer refuge in case of such misfortunes. With a home insurance policy, you’ll get reimbursed to replace damaged belongings or home due to unexpected happenings such as natural disasters.

However, there is an agreed limit on the amount that homeonwers insurance can compensate. The limit differs between homeowners insurance companies. To be sure of the amount, discuss this with your insurance company. Generally, the personal belonging policy covers furniture and day-to-day items. You may need to separately insure things such as coins, precious metals, and jewelry. Homeowners insurance may also protect your items when you are away from home. However, it is important to know that personal belongings protection for some items is not always guaranteed, especially when natural disasters like earthquakes or floods occur. To ensure you have a clear picture of what is covered and not by your policy, ensure that you have a meeting with personnel from your insurance company and have a thorough discussion on the topic. Going for a reputable company will also guarantee broader coverage, home insurance consumer feedback will help you identify reputable insurance companies

In case of a happening that damages your personal belongings, to successfully file a claim,  document whatever happened by taking photographs and videos. Take pictures from several angles. After documenting, contact your insurance company and start the filing claim process. Ensure you give all the details of your damaged belongings. Be honest with all the information you give. Your insurance company will inform you whether you will be compensated the actual cash value or will be given a replacement cost value for your belongings. When your claim is processed, accepted, and a figure agreed upon, you will either get your money as a whole or in installments. Below is what home insurance covers.

Replacement cost vs. Actual cash value
When paying out for covered belongings after damage, homeowners insurance policies generally use replacement costs. Replacement cost is the amount used to replace the damaged item with a new or used product. Actual cash value is the current value of the item after depreciation. For example, when the insured event damages a leather sofa, the actual value will consider the age of that sofa, and it will be lower than the replacement cost.

Homeowners insurance cover on personal belongings uses actual cash value on instances like floods. However, you can pay an extra amount to use the replacement cost. It works well if you discuss with your homeowners insurance company to see which is used. Some homeowners insurance companies offer “ guaranteed replacement cost” as a bonus.

Homeowners insurance and theft of personal belongings outside your home
Homeowners insurance policy will cover theft of your items in your home and outside your home. It is normal for homeowners to carry some personal items when traveling or walking outside their homes. When your laptop is stolen from a café or an airport, your homeowners insurance will compensate you for the loss. But coverages for the belongings outside your home may attract a lower limit than coverages for theft that occurs inside your home.

It is essential to note that homeowners insurance will cover personal belongings stolen from your car but doesn’t cover your car, and your car insurance doesn’t cover your personal items. If your car is stolen with your electronic gadgets inside, your homeowners insurance will reimburse you for losing personal belongings inside your car. 

Your homeonwers insurance will still compensate you for the luggage, and other values lost while on vacation. If your suitcase is stolen at the airport or a laptop is stolen from a hotel room while on vacation, your homeowners personal property coverage will compensate you for the stolen clothing and replace your laptop.

Similarly, if your kids at colleges live on campus premises, your homeowners insurance usually extends to cover their personal belongings. So if your child’s gadget is stolen from their dorm room, you can file a claim to be compensated for their loss. However, if your child’s belongings are stolen outside campus housing, they may not be covered since they should have a tenant’s policy to protect their personal possessions.

In conlusion, losing personal belongings can be a hectic and disturbing experience that no one would ever wish to have. It works well if we insurer our items with homeowners insurance to save us money in an unexpected occurrence.

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