Tips for Calculating the Value of Your Belongings for Insurance

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How to Determine the Value of Your Goods for Insurance

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Insurance is a tricky field to navigate and sometimes it can be difficult to figure out what your items are worth. If you have a lot of valuable items that you're going to be moving, how do you ensure the insurance coverage you choose will adequately cover everything? You'll have to sit down and crunch numbers to figure out the value of your goods and what insurance plan would be best for you during your move.

This guide will break down the process of shopping for moving insurance, specifically the process of determining how much your belongings are worth and what it will cost you to replace them in the event that any damage occurs to your moving shipment.

Making an inventory of your goods

When you're tackling a project as comprehensive as determining the value of all of your belongings and recording them for insurance purposes, spreadsheets are your best friend. Keeping tabs on your belongings and their value in an Excel spreadsheet can really help you keep things organized and allow you to stay on top of the inventory process as well.

If you don't have access to Excel, writing it down the old-fashioned way will work too. It helps to divide your table into three separate categories: one for the current replacement value of the item, meaning how much you would pay in a store right now to replace it; one for the total cost of the item when you bought it, meaning how much you actually paid for it (if you can't remember or don't have your receipt, use your best guess); and one for your best estimate for how much the item is worth right now in its current state, meaning if you were to sell it right now on eBay or in a yard sale, how much would you price it at?

Separating the values of your items into these three distinct categories will help you decide what kind of insurance coverage you should choose when the time comes to pick a moving company. For example, some moving insurance plans only cover the item's estimated value, some plans are based solely on the weight of the shipment, and other, more expensive, plans will cover the current replacement value of the item. Having all of this information on-hand will help you make an informed decision when the appropriate time comes.

Determining value

If you're having trouble figuring out what a certain item in your home is worth, there are several different methods you can use. If it's a piece of jewelry, taking it to your local jeweler and asking the staff for an estimate will usually give you a good idea of how much it's worth. For any other items such as electronics, clothing, or furniture, a quick internet search for similar products will yield a fair amount of results for you to compare and narrow down the figure that accurately represents your item.

For other, more obscure items like antiques and older items that are not on the market anymore, it will be a little more difficult for you to determine the current value. Usually, in these circumstances, it's best to make a reasonable estimation of the item's value.

Different types of moving insurance

Before you choose which type of moving insurance you'll be using for your move, it's a good idea to learn about all of the different kinds that are typically offered by moving companies. There are four main types of moving insurance that you can choose from, although it usually varies depending on what your moving company offers.

Here are your options when it comes to moving insurance and what each one can offer you:
  • Basic Carrier Liability - The most basic form of moving insurance that you could purchase, this is usually best for people who are moving on a tight budget and don't have many expensive or valuable items that they'll be moving. It is also the minimal amount of liability that must be provided to you by law, free of charge when transporting your items. It is known as the "released value", and is the insurance that is limited to .30 (intrastate) or .60 (interstate) compensation per pound per article. Check with your mover on what the minimum liability is for your state. With this form of coverage, a heavier item that weighs around 10 pounds (like a TV) and would cost you over $1,000 to replace would only get you $3.00 for an interstate move, and $6.00 for out of state under this insurance coverage.
  • Declared Value - This type of insurance coverage sets a specific amount that your mover is liable for, based on the total weight of your shipment. For example, a moving company might have a declared value of $1 per pound of insurance coverage. If your moving shipment weighs a total of 10,000 pounds, then the maximum total that your moving company is liable for is $10,000.
  • Lump Sum Value - Also known as assessed value, this insurance coverage allows you to purchase coverage for a specific amount, per $1,000 of value. For example, this type of insurance would be best for people who do not have a large shipment of goods, but who have several very valuable items that they would like covered while in transit. In this case, they will purchase an insurance plan that covers a certain amount that their items are worth.
  • Full Value Protection - This type of insurance coverage is the most comprehensive coverage offered by moving companies. It covers any lost, damaged or destroyed property and pays for any repairs or replacement of goods. This coverage, despite being slightly more expensive, is usually your best option to make sure all of your belongings are thoroughly covered in the event of any damages while in transit.

Other options for insurance

The moving insurance options outlined above are not your only choices when it comes to insuring your belongings for a move. If you're not moving many items and don't think it would make sense to insure your entire shipment, then you can choose to have only your most valuable items insured.

For example, let's say you're only going to be moving a small one-bedroom apartment with a few boxes of belongings and a couple of pieces of furniture, but you also have a few very expensive pieces of jewelry as well. While it wouldn't make much sense to spring for an expensive moving insurance plan to cover all of your belongings, it would be feasible to take out some insurance for only your most expensive pieces of jewelry to make sure you're covered in case anything happens to them during the move.

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on April 9, 2013

Movers.com - Moving Expert
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