If you're wondering about insurance before moving, remember that no matter how careful you are in choosing movers, accidents can happen. Boxes can be bumped or dropped or shift during transit and no amount of research will guarantee the safe arrival of your goods. What can be controlled is how effective your moving company is at resolving claims and making sure you're adequately covered should an accident occur.
Making a Claim
Let me mention up front, in case you don't get to the end of this article, that if you need to make a claim, before you sign the inventory sheet, report the facts in detail on the original inventory sheet. If you notice damage after unpacking, a claim must be filed within nine months after delivery. Remember that it's best to report the damage as soon as possible. The mover must acknowledge receipt of your claim within 30 days and must deny or make an offer within 120 days of receipt of your claim.
When making a claim or considering a settlement, refer to the liability amount you declared on your shipment. For example, if the value declared on your shipment was $5,000, the mover's maximum liability is $5,000. Claims for more than this amount will be declined because they are more than the mover's liability. Make sure you're adequately covered.
Types of Insurance
First, it's good to know that most moving companies automatically provide "valuation" not insurance. Valuation is the predetermined limit of liability as stated on the moving contract or bill of lading. This is automatically part of the contract with no extra cost. In most cases, valuation has no relationship to the actual value of your goods.
So, to know if you're covered, you need to understand the three types of "valuation" the moving company may provide:
- Declared value: The value of your possessions is based on the total weight of the shipment multiplied by a specific amount per pound. For example, if the specific amount is $1.50 per pound, and your household goods weigh 15 000 pounds, the mover would be liable for a maximum of $22,500. The settlement is based on the depreciated value of the damaged goods.
- Lump sum value or Assessed Value: If your household goods do not weigh much, but are valuable, you may need insurance that is based more on cost than weight. This means you can purchase insurance for a specific amount per $1,000 of value. This must be declared in writing on the bill of lading.
- Full value protection: This coverage includes lost, damaged and destroyed property. The coverage will pay for the repair or replacement of the goods. Usually there is a minimum coverage amount and applicable deductibles.
Now that you understand what kind of "valuation" is available, you're ready to move onto the next task.
Assess the Value of Your Household Goods
- Write down all significant pieces of furniture, glassware, appliances, electronics, cameras, etc..., give each a number and an approximate weight. If you have a large number of books that you'll be packing into boxes, assign each box a weight. This can be applied to kitchen items, clothes, knickknacks and any other high volume item.
- Give each item or box on your list a replacement value. Replacement value means the cost to replace the item with another item of comparable material and quality. The item must be used for the same purpose. This applies unless the cost to repair or replace the damaged item is less.
If you are moving fine art, valuable instruments or antiques, make sure you inform the moving company and apply extra precautions in packing and insuring each item.
- Take photos of all pieces, especially items of high or sentimental value. This will assist in keeping track of your inventory and will help if you need to make a claim.
- Now add up the number of items, the total weight and the total value. Keep this list on hand when you're interviewing moving companies. This will help you determine if the moving company is providing enough coverage.
Moving Company Insurance (Valuation)
When meeting with the potential moving company, make sure you check the following:
- Determine exactly what kind and how much liability coverage they provide for property loss or damage.
- Carefully check the contract for the estimated value of your possessions and match it to your own list.
- Determine the maximum value of the mover's insurance should your goods be damaged. Again, compare it to the total value you assessed from your list. Is it enough? Keep in mind that the amount listed is not guaranteed. Like most things, it is subject to government regulations, taxes and laws.
- Ask about the moving company's process to submit a claim. Find out if they have any outstanding complaints or claims.