Advice on Moving Insurance

Insuring your possessions during a move is important, whether you're going across town or across the country. Use one of the major national companies for a long-distance move or check regional movers with the Better Business Bureau. Federal law sets insurance regulations for interstate moves but those within a state are governed by state laws.

Basic Insurance

The Federal Motor Carrier Safety Administration requires that basic insurance at 60 cents per pound is included in the cost of interstate moves, but in-state moves can have basic protection as low as 30 cents a pound. That won't be much help if a 10-pound stereo worth $500 is damaged. Be sure to verify the exact terms of any moving contract you are asked to sign.

Check Your Homeowner's Policy

Check your homeowner's policy. Some cover goods in transit, but this will vary and will depend on when you gave up the policy on your old home. Most homeowner's policies also cover only the depreciated value of goods, not their replacement cost, and will have the same deductible you had in your old house. You may need more insurance even if your policy is still in force.

Make a List

Before you make any insurance decision, list the things being moved. Put down the approximate value and estimate the weight. Also, assess your risk. If you're only moving a bed and a few chairs, a less-expensive option may be satisfactory. If you're moving a houseful of furniture and appliances, you need more protection. A long-distance move over Interstate highways will have more risk than a local move.

Protect Full Value

Get full value protection to cover your goods up to their current value. Rates vary, but usually are 1 to 1.5 percent of the value covered. Rates also will vary with the amount of deductible you choose, from $250 to $1,500. Items worth more than $100 a pound will have to be specifically listed. Federal rules say movers will implement this coverage on interstate moves unless you specifically choose only the basic coverage.

Choose Lump Sum

You also can get "lump sum" insurance setting a value per pound, like $1.25. If your shipment weighs 5,000 pounds, you'll be covered up to $6,250 total, but the payment for each item lost, destroyed or damaged will be based on its depreciated value. This is a form of full value protection at about the same rates. You'll have to list each item with its value.

Buy Special Insurance

You can buy third-party insurance from a major insurance company, but these rates vary widely by region and by moving company. Insurance companies rate the risk by region and by mover. You have to get these rates from an agent for your specific move and you'll have to get the policy before your moving date. Some moving companies will offer third-party insurance options.

Understand Any Limits

Know exactly what you are buying. Packing some items yourself may limit the mover's liability. Liability also may be limited if you did not notify the mover about objects of extraordinary value. You'll also have to demonstrate clearly that any loss or damage was the mover's fault and electronic items are covered only if you can prove the item was dropped or mishandled during the move.

Limit Your Loss

Decide how much loss you can afford. If a total loss would wipe you out, buy the most insurance you can afford. Use this same basis to decide any deductible. The higher the deductible on any policy, the lower your rate. You may get a better rate with a $1,000 deductible, but be sure you can afford that.

Take Pictures

It's a good idea to take pictures of your belongings before they are loaded so you can document any damage. Keeping a list of items and matching it with what's unloaded will help you identify lost or stolen objects to file an insurance claim. Always check claim procedures on any insurance so you know how to recover. You will have a limited time in which to file a claim, so check promptly.

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