Summer is primetime for moving. For agents, this creates an opportunity to talk with clients about what type of coverage they need, from the moving van to the new home.
With May almost over — a month which kicks off both the summer season and the most popular time of year for moving — many of your clients are going to be packing boxes and loading moving vans en route to new apartments and homes. According to the American Moving and Storage Association, each year some 35 million Americans box up their belongings and change addresses, with roughly half of those moves taking place between June and September.
Your clients who are relocating are going to be understandably excited about their new digs, but that’s no excuse for them to make their move unprepared — and underinsured. While they may be thrilled at the idea of putting down roots in a new home, they still need to take steps to ensure their valuables reach their new residence intact. For insurance agents, use this as an opportunity to review their coverage. That way, you can show them what’s covered under their current policies, or what additional protection they need.
What’s Typically Covered
If your client owns homeowners or renters insurance, their items are usually covered while in transit or in a storage facility. That coverage doesn’t apply if a moving company is responsible for any damages, however. In that case, the moving company’s insurance policy would take effect, which you can review with your client when the time is right.
If your client is relocating to another state, federal law mandates that moving companies offer two types of coverage: released value coverage (i.e., basic carrier liability), and full value protection. Full value protection pays for the current full replacement cost or repair of damaged items. Your client can choose the deductible, which will either lower or increase the price. Although your client will pay more for this option, it may be worth it based on the value of the contents being transported.
No extra fee is required for released value coverage, which bases any compensation on the weight of the item. A moving company typically would pay 60 cents for each pound of the article if it’s damaged. Therefore, if your client is moving electronics that weight just ten pounds but that are worth $1,000, the moving company would only reimburse them $6. Depending upon the value of your client’s belongings, full value protection may be the better choice.
For in-state moves, check state regulations regarding moving company insurance requirements. In either case, you should encourage your client to make a detailed list of what they’re moving and the estimated value of each item. If your client needs to file a claim, the information will easily be available.
Alternatively, clients may opt to move the old-fashioned way: on their own. If so, homeowners and renters insurance provisions may apply — but often only for potential hazards covered under policies such as fire and theft. If the car catches on fire and destroys the property inside, for example, your client would be reimbursed. Conversely, your client wouldn’t be covered if they were involved in an accident that damaged their possessions; that is, because they assumed the risk by using their own car.
Renting a truck or moving van is another option. The National Association of Insurance Commissioners notes that some but not all personal auto policies extend liability coverage to a driver when renting a truck based on the size of the vehicle. Many policies, however, don’t include that coverage, so it’s important for agents to review coverage with a client before they rent a moving van.
When renting a truck, you’ll likely want to recommend that your client purchases insurance from the rental company. They can pick either Supplemental Liability Insurance (SLI), which pays for any third-party claims filed against the driver of the truck or the rental company, or Limited Damage Waiver insurance (LDW), a provision that exempts the driver from paying for any damages to the rental truck. The rental truck company may also let your client buy insurance for their belongings.
Once your client is safely in their new home, take the time to review their entire insurance portfolio. Perhaps their new location is at heightened risk for flooding, or they have a shorter, safer commute. Those factors will impact their insurance rates, and they’ll appreciate the thought you put in making their coverage work for them.