A Guide to Insuring Personal Property

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In the wake of the massive losses caused by Hurricane Harvey in Houston and along coastal areas of Texas, insurance policies that provide personal property coverage are being discussed by news media outlets, law firms, insurance agencies, and individuals who are interested in adding a layer of financial protection to their lives.

One particular related news story that received a lot of attention was an ABC news segment featuring a Houston woman who had survived Hurricane Katrina more than a decade ago. She was rescued from the roof of her home and was concerned about her future since everything she owned was underwater. However, she also mentioned she had renters insurance.

Since personal property coverage is a typical component of renters insurance, there is some hope for the aforementioned Houston survivor. The same type of coverage is available for residents of Chula Vista as well, and here are some details you should know regarding this type of coverage.

The Basics of Personal Property Coverage

As previously mentioned, this coverage is often found in renters insurance policies, but it may also be included in other policies such as Chula Vista home insurance. Like other types of coverage, it is designed to cover the costs of replacing or fixing personal items such as furniture, clothing, electronics, toys, artwork, and other objects of value. As with all other insurance provisions, there is a stated coverage limit.

Value Determination

When personal property coverage is included in other policies, a standard coverage limit applies. For example, the National Flood Insurance Program extends $100,000 worth of personal property coverage. In other situations, the limit can be determined by the value of the items that will be insured. Insurance agents recommend taking photos of the items, gathering receipts, and adding up all values. Items that need to appraised, such as rare coins and stamps, will likely need separate, special coverage.

Replacement of Property

Depending on the terms and provisions of the policy, replacement of lost or damaged property may take place based on actual cash value or replacement cost. The difference between the two is depreciation. Replacement cost coverage is often better since it treats personal property as being new, but this may entail paying higher premiums.

Scheduled Personal Property

Depending on various circumstances, some personal items may require higher coverage due to their intrinsic value. For example, antique jewelry may have to be categorized as scheduled personal property since not every jeweler may be qualified to repair it. Insurance companies often set limits on jewelry as part of personal property coverage, but some exceptions can be made for certain items. Let’s say an elaborate set of locking rings is worth $3,000. This item may not be valuable enough to insure on its own, but the insurance company may set a limit of $1,000 for jewelry as standard personal property coverage. This way, the ring set can be listed on a schedule so a premium adjustment can be made.

To learn more about insuring personal property, reach out to the insurance experts at American Tri-Star. In addition to property insurance, we also provide reliable auto, health, and commercial insurance. Chula Vista, CA, residents can call 619-827-0522 today for a free quote.