Is moving insurance worth it?
High-value items or high-mileage moves might call for more coverage
Moving is an exciting but often frustrating experience. To simplify the process, many hire moving companies, but it’s crucial to make sure your household items are safe and secure with any help you hire.
Accidents happen even with the most trusthworthy movers, though. Most basic coverage is free from your moving company, but you might opt for more comprehensive coverage if you have lots of high-value items or have a long interstate (or international) move ahead of you.
- Basic coverage is usually free and meets federal interstate requirements.
- Full-value protection usually costs around 1% of the value of your items.
- Basic or full coverage from a mover is void if you pack your own things.
What is moving insurance?
Simply put, moving insurance is a protection plan for your items transported by a moving company. Typically, you have three options for moving insurance:
- Basic coverage: Also known as “released value protection,” this is the most fundamental form of coverage for moving.
- Full coverage: Sometimes known as “expanded valuation” or “full-value protection,” this coverage is for the full replacement value of lost or damaged goods.
- Third-party insurance: Sometimes, even full coverage from a moving company isn’t enough. For more valuable items, it might make sense to opt for third-party insurance.
Moving companies that perform interstate moves must provide basic and full-coverage options. Technically, moving companies cannot sell insurance — what most people call “moving insurance” sold by a mover is actually moving coverage. True moving insurance is only available through third parties.
How does moving insurance work?
Your coverage depends on the type of plan you choose. If you go for free, basic coverage, you’ll get the minimum coverage required for out-of-state moves. The most comprehensive coverage consists of both full-coverage insurance from the mover as well as third-party insurance.
If you’re moving a short distance and don’t have several delicate high-value belongings, basic coverage is probably enough
Released value protection
Released value protection (basic coverage) is a federal requirement for interstate moving companies. Quotes from moving companies automatically include this coverage, so it doesn’t cost extra.
Released value protection typically provides 60 cents per pound per item, which isn’t enough coverage for most people. (The average weight of a 50-inch TV is 35 pounds, which means basic coverage only provides $21 in reimbursement for damage of a TV this size.)
This coverage is also potentially void if you pack your own things — you assume responsibility by packing. Basic coverage is best for those moving a short distance with few high-value items or who really need to save money.
Who might use basic coverage: A college student making a short move from their dorm room to their parents’ house for the summer might opt for released value protection if they’re strapped for cash and don’t have any items of especially high value.
Full-value protection offers significantly more coverage than released value protection. A common valuation for full coverage is $6 per pound — so if your total shipment was 5,000 pounds and all of it was lost, destroyed or damaged, you’re entitled to up to $30,000. Full-valuation coverage typically costs about 1% of the value of the items you're moving.
Some companies do offer full valuation based on the actual estimated value of your items. If you’re interested, ask each moving company if it offers this when you’re gathering quotes.
Although the coverage is “full,” it still doesn’t cover everything, so you may want to spring for third-party insurance if you think you need more.
Who might use full coverage: Families planning a cross-country move might opt for full-value protection, especially if they’re willing and able to spend a bit more to protect their household items or if they’re worried about a natural disaster damaging their possessions.
Third-party moving insurance
If you have lots of high-value jewelry, third-party coverage might make sense for you.
For high-value items, like jewelry, released value protection and full-value protection often don’t provide adequate coverage. Third-party moving insurance is a good option to cover items like this.
It’s typical to purchase third-party moving insurance to cover damage from:
- Natural disasters
- Mechanical and electrical accidents
- Mold and mildew
- Moths and insects
- Temporary storage
Who might use third-party insurance: A family moving across the state who wants to insure jewelry, some antiques and several valuable paintings may benefit from third-party insurance that adequately insures these expensive belongings. This family would probably also opt for full coverage from the mover for the rest of its possessions.
What does moving insurance cover?
While both cover your items transported during a move, keep in mind that moving coverage and moving insurance are technically two different things. Moving companies offer moving coverage, and moving insurance is available through third-party insurance companies.
Moving company coverage: Loss or damage incurred while items are under the care of the moving company, up to a certain dollar limit
Third-party insurance coverage: Damage from acts out of the moving company’s control or beyond the liability limit
What isn’t covered by the moving company?
Coverage from the moving company doesn’t cover a few things. It’s important to keep in mind that if a moving company isn’t directly involved with the items, the company isn’t responsible for them.
Exclusions in moving company coverage include the following:
- Items movers didn’t pack
- Natural disasters that damage goods
- Damage in storage not associated with the moving company
Third-party insurance, on the other hand, does cover items damaged under these circumstances.
Do I need moving insurance?
For an interstate move, you need basic coverage to make sure you meet federal requirements. If you want to make sure your household items are covered in case of damage or loss, it can be worth it to pay a small fraction of your items' total value to further protect yourself financially in a worst-case scenario.
Free basic coverage isn’t enough for most families moving to a new state. It’s smart to consider upgrading to full-valuation protection or opting for third-party insurance for items of high value if you’ve got a big move ahead.
Some food for thought: Kurt Grosse, a real estate agent with Realty One Group in Las Vegas, said about his recent move: “We moved 1.5 miles in our last move. The movers scraped the back of our $5,000 leather couch along the stucco corner or the house. Because standard insurance pays by weight, we were given $60 for 100 pounds. The broken family heirlooms and crystal were not worth making a claim due to the minimal weight.” This is why paying for more coverage can be worth it for some.
Will my current insurance cover my move?
Your homeowners insurance, renters insurance or condo insurance might cover part of your move. It’s a good idea to check with your insurance company to see what’s covered. Some insurance companies offer the following moving coverage:
- Coverage for belongings not at home
- Relocation insurance
- Trip transit insurance
- Total loss coverage
One potential problem using an existing insurance plan to cover a move: Your future premiums might increase if you make a claim.
How much does moving insurance cost?
The cost of moving insurance varies based on the type of coverage you purchase and the details of the coverage.
Released value protection
Released value protection, or basic coverage, is almost always free. You just have to make sure you agree to it in your contract.
Full-value protection typically costs 1% of the total estimated value of your household goods. Here’s how to calculate full-value protection costs (in most cases):
- The moving company weighs the household items — in this case, let’s assume they weigh 5,000 pounds.
- The company gives a value for each pound, usually $6. In this case, the moving company would value a 5,000-pound shipment at $30,000.
- The cost is typically 1% of the total value. You pay 1% of $30,000, or $300, for coverage.
Full-coverage estimates (based on a $6-per-pound valuation)
|Weight of move||Value of goods||Full-coverage cost|
The cost of third-party insurance depends on the company and policy, but prices tend to range from 1% to 5% of the total valuation. Insuring items valued at $5,000 would cost you $150 at a 3% rate.
Estimated costs for third-party insurance
|Value of covered items||1% of valuation||3% of valuation||5% of valuation|
How to get movers insurance
By federal law, basic moving coverage comes with every interstate move. If you want to upgrade to more comprehensive coverage, ask your moving company for details on its policy before you sign a contract. If the company’s policies don’t offer enough coverage, you can reach out to a third party for insurance.
- Are moving companies responsible for damages?
A moving company is only responsible to a certain extent. Movers are responsible for damage to your home and any items they pack. They’re also responsible for items damaged or lost in transit.
Movers aren’t responsible for items they didn’t pack, damage caused by natural disasters or belongings damaged while in temporary storage not affiliated with the company.
- Does my homeowners insurance cover moving?
In some cases, yes. It’s best to check with your homeowners insurance company, though, because policies differ.
- Does renters insurance cover moving?
Renters insurance typically doesn’t provide adequate coverage for moving. Consult your renters insurance policy for full details.
- What if I’m moving from my parents’ home to a new place?
If you’re moving out of your parents’ home and are under their policy, their insurance might cover part of your move. This isn’t always the case, but it’s worth asking your parents’ insurance agent.
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