How To Determine How Much Homeowners Insurance You Need
Insurance For Your Personal Property
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Personal property covered under a Homeowners Insurance Policy includes:
- Owned and borrowed property.
- Your property located anywhere in the world.
- Property you have at a second home is covered for only up to 10% of your home's coverage.
The amount of insurance that comes with a Homeowners policy depends on whether your own a house or an apartment.
Houses: If you own a house, your personal property is automatically covered up to 50% of the coverage on your house. If the value of your personal property is more than that, you can increase the percentage. However, you cannot reduce it below 40% of the coverage on your dwelling.
Apartment: If you rent an apartment or own a co-op or condo, your personal property is automatically covered for a minimum of $6,000. This can be increased by amending your Homeowner's Policy.
It is preferable that personal property coverage is written on a replacement cost basis, so that you can repair or replace damaged or stolen items.
To help determine the amount of personal property coverage you need, consider preparing a Household Inventory.
With respect to coverage on items such as jewelry, coins and stamps, keep in mind that Homeowners policies limit the amount of loss you can incur on items like this. If your household inventory shows that you own items listed in the following chart with a value in excess of the limits, consider buying an endorsement (an amendment to the policy) to increase the limit. You could also consider a Personal Articles Floater policy to insure separate items fully, without a deductible, wherever the items happen to be.
Dollar Limits on Specified Types of Personal Property & Costs to Increase Limit By Endorsement
Class of Property |
Dollar Limit |
Estimated Cost to Increase Limits |
Money, bank notes, bullion, coins (including collections) and medals. |
$ 200 |
$6 per $100 |
Securities, manuscripts, personal records, stamp collections, and valuable papers. |
$1000 |
$5 per $100 |
Watercraft, including their trailers, equipment and motors |
$1000 |
Not permitted |
Other trailers |
$1000 |
Not permitted |
Grave Markers |
$1000 |
Not permitted |
Jewelry, watches, furs, and precious and semiprecious stones by theft. |
$2500 |
$10 per $1000 |
Loss of firearms by theft |
$2000 |
$3 per $100 |
Loss of silverware, silver-plated ware, gold ware, gold-plated ware, and pewter ware by theft. |
$2500 |
$16 per $5000 |
Property on the residence premises used for business purposes. |
$2500 |
$25 per $2500 |
Property away from the residence premises used for business purposes. |
$ 250 |
To $275 with insurance listed above. |
Electronic apparatus that may be powered by electrical system of a motor vehicle but which retains its capability of being operated by other sources, while in or on a motor vehicle. |
$1000 |
Varies |
Electronic apparatus that may be powered by electrical system of a motor vehicle but which retains its capability of being operated by other sources if used at any time or in any manner for business purposes, while away from the premises. |
$1000 |
Varies |
SOURCE: Family Money (Insurance Information Institute, Missouri Association of Insurance Agents)
If you don't wear your valuable jewelry or look at your valuable collections often, consider putting them in your safe deposit box at your bank and asking your insurance company or broker for "valuable article coverage for in-vault jewelry." Losses from a vault are possible, and banks are generally not liable unless found negligent. Vault coverage can be only $3 per $1,000 versus the $10 per $1,000 covered by many policies
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