New neighborhood. New beginnings. New memories. Moving to a new home is an exciting time. When you awake that first morning in your new bedroom, all the challenges of packing and planning fade. The neatly stacked boxes serve as a reminder that the next chapter of your life is starting. The hard part is behind you, the adventure begins.

That is, of course, providing that your things arrived safely and intact. Unfortunately, moving belongings from the old home to the new does not always go smoothly for some. Items can be damaged and broken due to improper packing or handling. Unexpected extreme weather or even theft can result in much-loved pieces being lost forever.

With all the planning and tasks involved in a move, it can be tempting to rush through reviewing detailed paperwork. And when it comes to understanding insurance coverage, the complicated options often seem anything but straightforward.

What is Moving Insurance

Most people are familiar with homeowners or renters insurance. An insurance company provides a policy to cover the belongings within your property against unexpected events and disasters. Some policies cover your car and its contents as well.

Usually, homeowner and renter insurance policies cover belongings while they are physically in your home, but not during transit. Moving exposes your items to damage, theft, loss, and breakage. Unless your policy specifically states that items are covered in transit, your belongings will be at risk. Moving insurance acts as protection while your belongings are outside your home.

Coverage Versus Insurance

If you hire a professional moving company, there are some automatic coverages to protect your belongings. However, you’ll want to understand the limitations of this coverage. The first thing to understand is that there is a difference between coverage and insurance. Coverage comes from your moving company, whereas insurance can only be provided by a third-party insurance company.

Coverage

• Provided by your moving company
• Zero or smaller up-front cost
• Limited compensation

Insurance

• Provided by a third-party insurance company
• Higher up-front cost
• More comprehensive protection options

Local Versus Interstate Moves

Federal law obliges moving companies to offer coverage for all interstate moves, whereas local moves are governed at the State level. Most reputable moving companies will offer the coverage whether the move is local or interstate. It pays to double-check the paperwork you receive to determine which type of coverage they offer.

Different Types of Moving Coverage and Insurance

For interstate moves, there are two types of coverage that a moving company is required to provide: Released Value Protection (RVP) and Full Value Protection (FVP.) The law states that your moving company must include both options in your estimate. RVP is without charge, and FVP has a fee. You can choose either option by accepting or waiving the fee for FVP.

Released Value Protection Coverage (RVP)

This minimum coverage is provided without cost. RVP, also known as Basic Carrier Liability, is based on the weight of your items and pays out up to 60 cents per pound. So if your movers damage an item that weighs 20 pounds, the payout would be 0.6 multiplied by 20, which equals $12.

Full Value Protection Coverage (FVP)

By Federal law, your moving company must include the Full Value Protection (FVP) on your moving estimate. You can decide whether or not you want to accept the coverage by accepting or waiving this fee. If any of your belongings are lost, damaged, or destroyed while in the possession of your moving company, Full Value Protection requires the mover to either:

• Repair the item/s or
• Replace the item/s or
• Offer a sum equivalent to repairing or replacing at the current value

FVP covers your property at a rate of between $6 to $100 per pound multiplied by weight. To know how much you’d pay for Full Value Protection, you’ll need to know:

• The weight of your belongings
• The overall value of your belongings

For example, belongings from a typical one-bedroom apartment weigh approximately 2,500 lbs. At the minimum $6 per pound, your coverage would be 2,500 x $6 = $15,000. Your fee at 1% would be $150.

Third-Party Liability Insurance (Insurance)

Insurance can only be provided by an insurance company. You may have the option to purchase insurance through your mover. In this case, the moving company acts as a broker, and your policy will be from a third-party insurance company. Insurance is governed by state and federal law and will be more expensive and comprehensive than valuation coverage.

Why Do I Need Moving Insurance?

With the hustle and bustle of moving, some details are easily skipped. Trying to prioritize your time and attention between packing, decluttering, moving utilities, and changing your address can be overwhelming. But it’s worth deciding what type of coverage you want to protect your belongings. Here are the reasons why moving insurance or coverage is a good idea:

• Safeguards your belongings against damage, loss or theft
• Peace of mind knowing that your items are covered
• Essential if you have high-value items.

Which Type of Coverage Should I Choose?

The type of coverage you’ll want will depend on your situation. Before deciding, make a full inventory of your belongings, including their value and condition. This will help you assess the level of coverage you need.

Here is a breakdown of the different options:

Released Value Protection:

• Provided free of charge
• 60 cents per pound coverage
• Automatically provided for long-distance or interstate moves
• Only valid if the movers pack your belongings
• Only valid while your belongings are in your movers’ possession

GOOD FOR:

• Short-distance moves
• When you don’t have valuable belongings
• If you need to save money on moving costs
• For example: Someone in a roommate situation with few belongings/ Student moving to a dorm/ Someone moving to or from their parent's home

Full Value Protection:

• Coverage provides between $6-$100 per pound multiplied by overall weight
• The fee is usually approx. 1% of total coverage
• Required (by law) to be offered for long-distance or interstate moves
• Only valid if the movers pack your belongings
• Only valid while your belongings are in your movers’ possession
• Only covers damage caused by movers (not theft, fire, natural disasters, etc)

GOOD FOR:

• Longer-distance moves
• If your belongings have some value (but are not high-value)
• Families and multi-room moves
• For example: A family moving from a multi-room house or apartment with many belongings but nothing of significant value (ie: over $100 per pound)

Third-Party Liability Insurance

• The most comprehensive level of coverage
• Provided by an insurance company, not the moving company
• Protection against more events such as natural disasters (although flooding is often an exclusion), mechanical and electrical accidents, insect damage
• Usually costs between 1-5% of the value
• NOTE: coverage significantly varies from one insurer to the next, be sure to review the policy carefully, and ask questions about particular scenarios

GOOD FOR:

• High-value (over $100 per pound) items such as artwork, jewelry, expensive electronics
• Could be used as a gap-filler to supplement FVP

Questions to ask

Be sure you understand the details of your coverage whether it’s from the moving company, a third-party insurer, or a combination of both. Here are some questions to ask:

• Does the policy cover items only while they are on the moving truck or while they are being lifted/moved to and from the truck?
• Are there any items that can’t be insured or aren’t covered?
• Are certain types of furniture (such as pressed-board) excluded?
• Is there a specific way things should be packed?
• What is the process if something is damaged or lost?
• Are there any scenarios that are not covered (such as flooding, storage etc)
• Is my existing homeowner’s/ renter’s insurance policy sufficient? Would a claim put me at risk of paying a higher premium in the future?

Get the Highest Level You Can Afford

Choosing whether or not to purchase moving insurance is a personal decision. As a general rule, the longer your items are in transit, and the more valuable belongings you have, the higher level of insurance coverage you should seek. Start by thinking about how much inconvenience you would suffer if your items were damaged or destroyed, and compare this with your overall budget.

If your belongings are somewhat valuable and heavy, then the Full Value Protection might be sufficient. If you have valuable, but not heavy, items and a higher budget you could waive the FVP and opt for third-party insurance.

Moving home can be a challenging time, and there are certainly a lot of tasks and details to be managed. By paying a little attention to moving insurance, you can have that extra peace of mind that your belongings are safeguarded.

Contact Capital City Movers today for a stress-free move at (718) 619-4881.