Personal property insurance refers to your property that the insurance company might not cover in regular house/property insurance. It can be specific items that are not attached to the property, such as clothing, jewelry, furniture, art, and so forth. It depends on your insurance company how much of it – if any – is already included with your homeowners’ policy. Even if it is, there are potential limitations involving the value.
Personal property coverage is usually part of a standard HO-3 policy. When setting up the policy under normal circumstances, the personal property insurance coverage limit will be around half the dwelling coverage limit. However, some companies might let you increase the former up to 70% of the overall dwelling limit.
Just like with the house itself, the replacement cost VS the actual cash value of the personal property items. Factors such as depreciation are at play. It is essential to know the limits on what the provider will pay to replace a similar item.
How each specific item becomes damaged or lost is another issue. If someone steals it, hope your property insurance covers theft. If it’s lost in flood, hope you have flood insurance for your home and contents.
Personal Property Insurance Covers Some Items, But Not Others
In general, here is a quick look at the types of items that policies often cover via personal property insurance: clothing, kitchen appliances, TVs, lawn care equipment, bikes, rugs, and trampolines. Don’t forget that many electric devices come with (optional) extended warranties and insurance anyway.
Also, you might not be reimbursed (at least not by your property insurance company) if an electrical failure or some fuse issue destroys your electronics. To obtain reimbursement for mechanical or electrical failure, you will likely need some endorsement for “equipment breakdown” or use a home warranty for appliances.
Most policies usually don’t cover some items in regular home insurance. Such items include baseball card collections, coin collections, artwork, wine collections, musical instruments, or even pets and plants. They can still be insured if you have them added as a “scheduled endorsement” onto your policy. Sometimes the company refers to it as a “personal article floater.”
Keep in mind that all of this information is typically what is you can expect with regular home insurance coverage. There is a newer company, Lemonade Insurance, which is changing the way home and personal property insurance work. You can do everything digitally, and rates start at $25 a month. Dwelling and personal property coverage come at affordable prices. Check if Lemonade is available in your state.