Moving Tips: What to Know About Moving Insurance and Liability

Insurance and Liability

Thinking about insurance and liability can cause quite the headache when planning a move. Insurance is often the area in moving that people know very little about. As a result, people make poor choices when choosing insurance. Don’t let this alarm you. We're is here to take the mystery out of insurance and liability.

Moving companies are required to assume liability for the value of the goods they move but the level of liability can vary. Be aware of the amount of protection and the charges for each option. Movers are required to provide you with information on what it will cost to place a value on your shipment. You should be provided with a brochure. Make sure you actually read these brochures so you can accurately put a value on your shipment. These brochures may be called "Here's what you need to know about placing a value on your household goods shipment before you move" (say that three times fast) or "Your rights and responsibilities when you move."

Check with the local Better Business Bureau to get information on how the mover has handled claims in the past. In the unlikely event you have loss or damage as a result of your move you have nine months to make a claim. However, you are still responsible for paying for the move in a timely fashion. This is generally cash on delivery (COD), paid on the day of unloading. The mover is required to respond to your claim within 30 days and the issue must be resolved within 120 days. If arbitration is chosen to resolve the issue and you are not satisfied with the outcome, you may still sue for damages.

Basic Carrier Liability-Released Value
Often called limited liability, it is the minimum coverage required by law. This type of insurance is covered in the base price. It is the most economical option available, but your goods will be covered no more than sixty cents per pound, per article for an interstate move, and thirty cents per pound (depending on the state) for a local move.

You may see this minimal amount of required liability when transporting goods referred to as "released value." Loss or damage claims are settled based on the pound weight of the article multiplied by sixty cents. If you have a 10-pound TV and it is destroyed in transit, you would be entitled to a total of six dollars for the replacement of the TV -- so, think carefully before agreeing to it. If you do agree to this insurance coverage option, you will be asked to sign a specific statement in agreement on the bill of lading.

Declared Value Protection
This coverage is based on depreciated value of an item, regardless of the current replacement cost. The whole shipment is covered at a value not to exceed the dollar amount that you, the customer, declare. With this option the mover assumes liability for the entire shipment at an amount equal to $1.25 times the weight of your shipment. For example, if your shipment weights 8,000 pounds, the mover will be liable for loss or damage up to $10,000.

Though you have made no specific arrangements for this plan (if you have not chosen another plan), you automatically default to it. The mover is then entitled to charge you $7.00 for each $1,000 of liability assumed. A charge of $70 will be added to your bill for additional liability if the declared value of the shipment is $10,000. Under this arrangement, if a 10-pound item valued at $ 1,000 is damaged, the mover is liable for up to $1,000, based on the depreciated value of the item. Under this plan your valuables are somewhat protected but you pay for it. Before obtaining this coverage you should consult your mover for additional charges and rules.

Full (Replacement) Value Protection
This option is often referred to as full replacement value protection. This is the most comprehensive insurance plan available for the protection of your goods while in transit. Any goods that are lost, damaged or destroyed during the move will be repaired, replaced or a cash settlement will be made at the mover’s discretion.

Costs vary depending on the mover. By choosing a higher deductible you may be able to reduce the cost. Coverage with deductible reduces the premium but you will be responsible for the first $100.00, $250.00 or $500.00 of loss or repairs, depending on the deductible amount. The mover can protect himself from loss or damage to high value items (i.e. value of over $100 per pound) unless you list these goods on the shipping document. Jewelry and furs are examples of high or extraordinary value items.

Talk with your mover so you can get a clear understanding of your options and make more informed choices.

Extraordinary Value Items
All items in your shipment considered to be of extraordinary value must be identified in a written statement to your van line agent. These items are defined as having a value greater than $100.00 per pound per article.

For example:
  • Antiques
  • Crystal
  • Precious Stones or Gems
  • Art Collections
  • Currency
  • Silver and Silverware
  • Cameras
  • Figurines
  • Video Cameras
  • Computer Software
  • Furs
  • Coin Collection
  • Oriental Rugs

If you include items of extraordinary value in your shipment, then you must sign a High Value Inventory sheet prior to your move. In the event of a claim, any settlement is limited to the value you declare for the entire shipment. If you fail to list all extraordinary value items and/or fail to sign the High Value Inventory sheet, the van line liability for loss of or damage to those items will be limited to no more than $100.00 per pound per article. This is based upon the actual weight of the article and does not apply to shipments under the "basic carrier liability" option.

You must declare the total amount of the released value that you declare for your goods. This total should include the value of items, including all items of extraordinary value. Record the total value on the bill of lading. Please note that the protection for items of extraordinary value is not available for shipments released to the van line's value of 60 cents per pound per article (basic carrier liability option).

Homeowner’s Insurance
Some homeowner's insurance policies cover household goods while in transit. Check with your homeowner's insurance company to find out what coverage you may have and be sure to check out when it ends. If the policy is void once you close on your old home it may be of little use to you. If you are fortunate enough to have coverage, make sure you contact the insurance company and ask them to explain the level of coverage. In the event you need to file a claim with the insurance you will need to prove that the loss or breakage is due to mover's negligence. Money will not be awarded for items damaged as a result of poor packing on your part.

You may want to print out this page and refer back to it when making your insurance choices. Now that the mystery has been taken out of insurance and liability, you should be able to make a wise and informed decision.