NEW YORK, July 27, 2009 — Those who are downsizing to a smaller apartment, moving home to live with parents to save money or simply have too much stuff, may find storage units a useful solution for dealing with extra belongings. While storage units may be the answer to decluttering your home, adequate insurance coverage is the answer to protecting items while in storage, according to the Insurance Information Institute (I.I.I.).
“If an item is valuable enough to merit paying for storage, it should be financially protected with the proper amount and type of insurance,” said Jeanne M. Salvatore, senior vice president and consumer spokesperson for the I.I.I. “Even in the best managed storage facilities, theft, fire and other disasters can and do occur. That’s why before signing a rental agreement, it is important to find out what types of losses will be covered by the storage facility and whether supplemental insurance may be needed.”
“Consumers should also check their home or renters insurance policies to learn how much insurance protection they may already have,” pointed out Salvatore.
Standard homeowners and renters insurance policies that include off-premises protection provide insurance coverage for property in storage facilities from theft and damage from fires, tornadoes and other disasters listed in the policy. They will not cover damage from flooding, earthquakes, mold and mildew, vermin or poor maintenance. Some insurers may limit the amount of coverage to 10 percent of the amount of insurance you have on your overall personal possessions for items stolen or damaged away from home. Other insurers may offer higher limits, so check with your insurance agent or company representative.
Personal possessions can be covered on either an actual cash value or a replacement cost basis. An actual cash value policy would pay only the depreciated value of an item, while a replacement cost policy would pay to replace the item at what it would cost to purchase it at the time of loss. Replacement cost policies generally cost about 10 percent more but are a better value in the long run.
If you intend to store valuable property such as art, antiques, jewelry, furs or other expensive items, there may be dollar restrictions under your standard policy. Ask your agent or company representative about adding a floater or endorsement to your policy in order to fully cover these items.
One of the best ways to protect your property and ensure that you are prepared to submit a claim in the event of a loss, is to create a detailed home inventory of all your possessions, including those in storage. If your property is stolen or damaged, an inventory can help speed the claims process and substantiate your loss. It will also help you determine how much insurance to buy to adequately protect your possessions.
In order make the process of creating a home inventory easier, the I.I.I. has developed free, online software called Know Your Stuff. The program walks you through your home room by room and allows you to enter important data such as purchase price, serial numbers, etc. You can also upload photos and scanned receipts and appraisal forms. The data is stored on a secure site where only you can view it—your inventory is safe and you can access it from any computer, at anytime.
The I.I.I. offers the following tips for choosing a storage company:
For more information about homeowners insurance, go to the I.I.I. Web site.
The I.I.I. is a nonprofit, communications organization supported by the insurance industry.