Moving can be a stressful and expensive process, and one of the key considerations when hiring a moving company is understanding the insurance options available to protect your belongings during the move. While moving companies cannot sell insurance policies, federal regulations mandate that they offer two liability options: released value protection and full-value protection. These options fall under the category of valuation coverage, or moving coverage. Additionally, you have the option to purchase true moving insurance from a third-party insurance provider for added protection.
Full-value protection (FVP) is the more comprehensive coverage option offered by moving companies. FVP covers the full replacement value of your belongings in the event of loss, damage, or destruction during the move. While FVP does come at an additional cost, it is the default coverage included in your initial moving quote. The moving company will address any issues with your items by repairing them, replacing them, or providing a cash settlement equal to the item’s full market value. However, it’s important to note that FVP does not cover items of extraordinary value, which are items worth more than $100 per pound. Despite this limitation, the moving company is still responsible for safely delivering any high-value items listed on the shipping documents.
The cost of full-value protection varies depending on the estimated value of the items covered. Some companies may price FVP based on a percentage of the value of your belongings, while others may use a simple formula or allow you to declare an estimated value. FVP policies also include a deductible, with lower deductibles resulting in higher costs. Some companies may offer customers the option to set their own deductibles to better suit their needs.
Released-value protection is the alternative coverage option required by the federal government for interstate moving companies. This basic coverage provides up to 60 cents per pound per item at no additional charge. However, the limitations of released value protection become apparent when considering the replacement cost of valuable items. If you solely rely on this coverage, you may receive significantly less than the actual value of your items in the event of a loss.
For those seeking additional coverage beyond what is offered by the moving company, third-party insurance is a viable option. Some movers partner with third-party insurance companies to offer more comprehensive policies that supplement the basic coverage provided by the moving company. This separate liability coverage may be worth the extra expense, especially if you have items of extraordinary value that require additional protection.
When opting for third-party insurance, the moving company will still adhere to the terms of released value protection, covering up to 60 cents per pound per item. The third-party insurer will then cover the remaining loss up to the coverage limits of the policy you purchased. If your moving company does not offer third-party insurance, you have the option to seek out a policy yourself. It’s important to remember that while valuation coverage is regulated by federal law, third-party moving insurance is regulated at the state level.
In conclusion, understanding the insurance options available when hiring a moving company is crucial to ensuring the safety and protection of your belongings during the moving process. Whether you opt for full-value protection, released-value protection, or third-party insurance, it’s essential to carefully consider your needs and budget to choose the coverage that best suits your requirements. By being informed about the available insurance options, you can have peace of mind knowing that your belongings are adequately protected during the move.