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Valuation coverage is a set amount moving companies are liable for if your belongings are damaged during a move. While it is not moving insurance, the two types of coverage share some similarities. Basic valuation coverage does not cost extra, but it may not offer the best coverage for your belongings. Here's what to consider.
What Does Valuation Coverage Cover?
When you work with a moving service, you automatically receive valuation coverage. This is not moving insurance, but rather a basic coverage that movers must supply. Valuation coverage is federally mandated and is meant to protect customers in case movers damage their belongings.
There are two types of valuation coverage:
- Released value protection:
- Provided at no extra cost.
- Movers are liable for $0.60 per pound per item. For expensive items, this can leave some serious gaps in compensation.
- Full value protection:
- Usually provided for an additional cost of 1% of the covered items' value.
- Movers can compensate you for the value of the item by paying for repairs, replacement or providing a cash settlement.
- Compensation for damaged items that have depreciated from their purchase value is limited to the actual cash value.
- You can declare items of extraordinary value to make sure they are protected. Items of extraordinary value are calculated as having a value of $100 or more per pound.
Consider how this type of coverage would apply to a lost or damaged tablet. A 12.9-inch iPad Pro weighs 1.5 pounds and retails for $1,099. Under typical released value coverage, movers would pay out under $1 for a damaged or lost iPad Pro.
Full value protection could compensate you fair market value but likely would fall short of the $1,099 cost to replace a broken tablet. Both valuation coverage options could leave you shouldering unexpected moving costs when replacing damaged items.
What Isn't Covered by Valuation Coverage?
Besides offering low financial coverage, valuation coverage simply won't cover some things. The items and incidents excluded by valuation coverage may include:
- Boxes packed by the owner rather than the mover
- Any perishable items or dangerous items that movers aren't aware of
- Weather events that damage goods in transit such as a hurricane
- Unnoted items of extraordinary value
- Damage that happened too long ago for coverage, such as if you waited to file a complaint about damage during moving
Items of extraordinary value, such as electronics or jewelry, which would have virtually no covered value under released value coverage, would be covered under full value protection if you remembered to declare them. Unnoted items are subject to released value protection.
If you anticipate any excluded items or incidents being a part of your upcoming move, relying only on valuation coverage could leave you with coverage gaps. Adding moving insurance could provide the extra coverage you need, however.
Can You Add Moving Insurance to Valuation Coverage?
You can add moving insurance to valuation coverage for more complete coverage of your belongings. Your mover may offer to sell you a moving insurance policy or you may seek one out yourself from a third-party provider.
You can ask the insurance agent you used to secure homeowners insurance or renters insurance at your new place if they have a recommendation for moving insurance providers or search for an insurer online.
When you purchase moving insurance, you do so for the value of your belongings. If your belongings are valued at $50,000, for instance, you can buy a $50,000 policy. If you file a claim, you may pay a deductible but will receive the full replacement value of your items up to face value of the policy.
Moving insurance costs about 1% to 5% of the belongings covered. This is more than released value protection or full value protection, but also offers the most complete coverage.
Moving insurance can cover:
- All items, even items of extraordinary value
- Items damaged by natural disasters in transit
- Compensation up the insurance policy's face value stacked on top of the released value provided by the movers
Adding moving insurance on top of the released value protection can give you the best coverage for unexpected events or damage.
Protect Your Belongings
Valuation coverage may be adequate for many moving people. This is especially true if you are able to transport your high-value items separately and are looking to cut moving costs. But for those looking for complete coverage while their belongings are in transit, combining valuation coverage with moving insurance may be the best option.