Contents insurance, also called personal property coverage or simply Coverage C, is the section of home insurance that insures the contents in the home. This type of coverage is usually included in a standard home policy.
Difference between Contents Coverage and Other Coverage in Policy
Typically, when a homeowner is searching for home insurance, he or she is looking to protect the building’s structure from damage caused by natural disasters, fires, lightening or hail. A homeowner would think that the dwelling or structure portion of the policy covers all the homeowners’ belongings located inside the property. It does not. The policy only reimburses the individual when damaged occurs to the building’s structure.
Fortunately, a standard homeowner’s policy protects more than just the building’s structure. Coverage B of a standard policy insures the other structures not attached to the property such as a shed or garage. Therefore, if lightning strikes the garage instead of the house, then the insurance company pays for the repair or replacement of the garage.
The policy also reimburses a homeowner for any financial loss incurred because he or she could not live in the property. For instance, if there was a fire, the homeowner and his or her family must live in a hotel. The home policy covers the day-to-day living expenses such as the restaurant and hotel bills.
The Contents insurance in a standard policy does not pay medical expenses associated with an injury to family member, guest or stranger on the homeowner’s property. Instead the Medical Payments, or MedPay, portion of the policy covers any injury that occurs on the property that is not a part of a lawsuit. The Personal liability protection portion protects against the home owner against any bodily injury that occurs on the property which results in a lawsuit against the homeowner.
Instead contents insurance protects personal items belonging to the homeowner and any family members. The items include household things such as refrigerators and stoves. It also can include clothing, sporting equipment and furniture. However, it is not limited to just those items. Nevertheless, there are exclusions that a standard policy doesn’t cover. For instance, pets, trailers and fixtures are some things not covered by contents coverage.
Type of Contents Insurance Coverage Needed
Generally, a homeowner insurance policy doesn’t cover the contents in the property 100 percent. Instead, a standard policy devotes from 50 to 70 percent of coverage toward replacing or repairing personal items. Property insurance companies can let property owners decide if the 70 percent is enough coverage or not.
Depending on the value of the contents in the home, a homeowner may decide to seek more coverage for the belongings. The best way to find out if the standard insurance is fine or if more is needed is by conducting a home inventory. The inventory allows the homeowner to create a list and take photographs of all personal belongings. Once the home inventory is complete, the homeowner can add the value of the entire list and compare it to the standard coverage given. If the coverage is inadequate, then he or she knows he must talk with the agent to receive additional contents coverage.
A Word of Caution Regarding Prized or Expensive Contents in the Home
Although each home insurance policy is different, it only pays a portion of the value of some belongings. It doesn’t matter if they are expensive, rare, collectable or prized possessions. For example, a standard policy may not cover the value of the expensive jewelry. If a diamond necklace was worth $20,000, the insurer may only $1,500 for the stolen or destroyed necklace.
Therefore, a homeowner needs to include a scheduled endorsement for that particular item into the home contents insurance policy. To add additional coverage, the homeowner must talk with the agent.
Contents Coverage Offers Piece of Mind
Damage and/or loss can happen at any time. The damage or loss may be serve or not that bad. Regardless of the severity the Coverage C protects the homeowner. In fact, house contents insurance protects homeowner’s personal belongings when weather related natural disaster, fire, theft, riots or any other damage or loss occurs.