We all have beloved possessions—some worth gold in sentimental value, others worth their weight in gold.
It’s only natural to worry about protecting these belongings.
But the truth is that:
Figuring out what insurance types will cover the possessions inside of your home isn't too complicated. This article will guide you through the different types of insurance that will cover your personal objects.
Types of Insurance That Cover Items In Your Home
There are two types of policies that will cover possessions inside of your home and we discuss them below.
Home Insurance
If you own a home and pay a mortgage, there’s a very good chance that you’re familiar with home insurance.
Home insurance provides coverage for certain insured risks that your home may face in the coming months and years.
Renters Insurance
If you rent an apartment, condo, room or private space in someone else’s home, then you’ve likely heard of or purchased renters insurance.
Renters insurance provides coverage for certain insured risks that you may face in your dwelling in the coming months and years.
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What Does Home Insurance Cover?
If you’re newly purchasing a home or looking to refresh your knowledge on your house’s existing policy, you may have wondered what, exactly, home insurance covers. Let’s break it down.
Home insurance covers four different aspects of your property:
Personal Property & Belongings
Personal property coverage covers your personal belongings, including but not limited to jewelry, artwork, clothing, electronics, and furniture.
So, if you lose your personal belongings to a covered risk or named peril, you can file a claim and the insurance company will pay up to a certain amount of the value of the items.
They usually pay out 50 to 70% of the total coverage on your dwelling and the perils include everything from ice damage to falling objects to theft.
Valuable Items Like Silverware & Jewelry
To determine if your current or future home insurance policy covers the full cost of your belongings, create a home inventory to calculate their value.
You might be surprised by how much value you’ve accumulated in your possessions. We also have a home insurance calculator to estimate your coverage needs.
Valuable items, such as silverware, jewelry and high-end artwork, almost always get covered. However, the insurance company may set a dollar cap on the amount that they will cover.
For these most costly items, consider purchasing a floater that will allow you to raise that dollar cap, also known as the limit of liability.
What is essential to understand is that your contents insurance only covers your belongings up to your policy limits. You set these limits when you set up your policy—the higher your limits, the higher your monthly premium.
Personal Property Coverage Example
As an example, say that someone steals your laptop from your car.
Your personal property insurance claim can help you to pay for a new one. In another scenario, say that your friend brought his Dungeons & Dragons books over for a game.
During the evening, lighting strikes and starts a fire. You and your friend are okay, but the fire destroyed his manuals.
They would be covered by your personal property insurance (if not already covered by his) because they were in your home when the damage happened.
If you have high-value items like jewelry or art, your insurance policy may not cover these fully. We’ll discuss this in more depth later in this article.
Best Company for Home Insurance
Hippo
With an average 4.9/5 rating from a combined 1964 verified reviews, Hippo is taking the home insurance market by storm.
Customers rave about Hippo’s friendly and helpful customer service agents and reasonable rates for quality insurance plans.
Hippo also features an eye-popping and user-friendly design for its website that boasts one of the most tech-savvy platforms in the insurance space.
Hippo can give you a quote in 60 seconds and an approval within 20 minutes.
Hippo also walks you through the normally daunting claims process with ease.
The company accomplishes this task by connecting you with a Hippo claims concierge, dedicated to keeping you informed and resolving your case as soon as possible.
Keeping all these positives in mind, I choose Hippo as the best company for home insurance in 2020.
What Does Renters Insurance Cover?
Renters insurance covers both property coverage and liability coverage. Let’s focus on personal property coverage.
This coverage protects your personal items that may be lost, damaged or stolen by a covered loss such as natural disasters or theft.
Personal Property & Belongings
Personal belongings can include, but are not limited to furniture, jewelry, electronics, artwork, and clothing.
However, you’ll need to pay the deductible for your personal property coverage before the insurer compensates you for the remaining value of your items.
You will receive compensation up to the dollar cap or limit stated in your policy.
As a renter, you’re particularly vulnerable to theft, so you’ll want to consider a renters insurance policy that has personal property coverage.
Bear in mind that insurance companies won’t cover the cost of daily use wearing down or damaging your items. It’s important for you as a renter to know the full value of your personal possessions to file a claim.
Creating a home inventory will let you know whether you need to purchase extra coverage, also known as a floater or rider.
You can also use inventory applications to make this process easier.
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Best Company for Renters Insurance
Lemonade
Gone are the days where you spent hours on hold for a simple question about your insurance policy.
Lemonade is an insurance company providing affordable renters insurance in the digital age.
Their renters insurance policy starts at a low $5 per month, which is much cheaper than the national average for renters insurance.
You can actually go from quote to coverage within 90 seconds and file claims in three seconds through a combination of artificial intelligence (AI) and employees.
Their instant claims process, straightforward tone, user-friendly design, and honest transparency resonate with millennials.
The company boasts more than 6,000 reviews and a nearly five-star rating.
Because of this I recommend Lemonade as the best company for renters insurance in 2020.
How to File an Insurance Claim
The exact way that you file a claim will vary by company, but you’ll always want to start by providing documentation or receipts for the value of your damaged or stolen items to your insurance company, which will speed up your claim.
If a thief has stolen your items or vandalized your belongings, you’ll also need to file a police report right away in order to improve your chances of getting a claim for your possessions approved.
This report will serve as proof to the insurer.
You’re also legally required to make a statement to your landlord informing them of the situation so that they can make any necessary repairs and report the incident to others in your building.
After making sure that you have documented the damaged or stolen items, contact your insurance company directly to file your claim.
You may be able to file directly online or you might have to speak with an agent on the phone first.
Taking Action
Whether you’re a homeowner or a renter, you can always find a way to protect your personal assets for the long run.
It’s important to take the time to assess your belongings and find an insurance policy that works best for you.
If you need homeowners insurance, we’ve done the hard work for you—check out the top four companies or get your free quote for homeowners insurance or renters insurance today.