Cost & Coverage
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Personal property coverage protects your belongings from burglary and damage.
Personal property coverage is the section in your homeowners insurance policy that covers your personal possessions
Your stuff is protected from covered hazards inside and outside the home
Certain expensive valuables like jewelry have strict coverage limits, but you can increase those limits for an additional premium
Personal property insurance, or personal property coverage, is a component of your homeowners insurance policy that reimburses you if your personal belongings are burglarized or damaged by a covered peril. That means everything from clothes to electronics to portable appliances are insured against covered damages or theft.
Your policy also dictates what type of property it will and won’t cover, and may only cover rare and expensive items like vintage instruments, fine furs, and jewelry up to a limited itemized amount, or sublimit. Most insurance companies offer enhanced personal property coverage, or endorsements for your policy that increase reimbursement limits on high-value items.
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Personal property coverage is a type of protection that you find in every homeowners insurance, condo insurance, and renters insurance policy. It protects your personal belongings — along with the belongings of blood relatives who live at the insured residence — up to the coverage limit specified on your home insurance declarations page.
In homeowners insurance, personal property coverage (also referred to as contents coverage or Coverage C) makes up one-sixth of a standard HO-3 policy. When setting up your policy, your personal property coverage limit will, by default, be 50% of your dwelling coverage limit. But some insurance companies will let you increase your personal property coverage limits to 70% of your dwelling limit.
After paying your home insurance deductible, personal property insurance reimburses you for damage to your personal possessions up to your personal property coverage limit. It covers your stuff inside the home, garage, and even items in your car or hotel room while you’re on the road. With personal property coverage, you’re protected against everything from fire to lighting to wind damage and theft.
An important thing to keep in mind is you won’t be reimbursed if an electrical failure or a fuse shortage destroys your TV or entertainment system. In order to be reimbursed for electrical or mechanical failure, you’re going to need an equipment breakdown coverage endorsement or a home warranty.
Here’s a rundown of the different types of personal property that are covered in a typical homeowners insurance policy:
Trees, plants, shrubs, and foliage are also covered under a standard homeowners insurance policy — generally about $500 per item. However, trees and plants are not covered for disease or natural collapses.
Personal property coverage is also extended to personal property losses that occur outside the home, but reimbursement limits on off-premises losses are limited. Losses away from your home are typically capped at 10% of your personal property coverage limit. While that may seem like a small amount, if your personal property coverage is set at $200,000, that’s still $20,000 in coverage for stuff in your trunk or your Airbnb rental.
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A typical homeowners insurance policy includes coverage for jewelry and other types of expensive and rare valuables, but they’re typically subject to limited reimbursement limits. Here’s a look at property limits for certain types of valuables:
|Items with special limits||Maximum sublimit|
|Money||$200 (includes coins and medals)|
|Securities||$1,500 (including stamps)|
|Jewelry||$2,500 (when stolen)|
|Furs||$2,500 (when stolen)|
|Silverware||$2,500 (when stolen)|
|Guns||$2,500 (when stolen)|
|Business property (on premises)||$2,500|
|Business property (off premises)||$250|
There’s a good reason why insurers put strict reimbursement limits on jewelry and other expensive property types: burglars are more likely to target those items if they break into your home. If every jewelry theft claim was met with a payout of its replacement value, insurance costs would skyrocket.
If you own precious metals or expensive keepsakes that are difficult to replace, you have a couple of options to increase your coverage:
Many insurance companies offer enhanced policy tiers for an additional amount. Our table above illustrates sublimits in a standard homeowners insurance policy, but many major insurers like MetLife, Safeco, and others offer premier plans with $5,000, $10,000 and $25,000 sublimits for rare and expensive valuables. But be prepared to pay a hefty premium.
This option allows for a little more customization. With a scheduled property endorsement, you simply list the expensive valuables you’d like enhanced coverage for in a form provided by your insurer, specify the appraised value of the item, and you’re covered for that amount. When you need to file a claim for a stolen or damaged scheduled item, you typically won’t need to pay a deductible, making it worthwhile. The cost of this endorsement will depend on how expensive the scheduled item is, but it’s generally about $25 per $1,000 in coverage annually.
Determining your personal property coverage needs depends on the type of property you own and how much it’s all worth. In short, your contents coverage amount should be enough to replace everything in your home if it’s destroyed or damaged. In order to ensure that you’re adequately covered, make sure to do the following:
There are two distinct types of coverage options that determine how much you’re reimbursed for a covered loss: actual cost value (ACV) and replacement cost value (RCV).
Actual cash value coverage pays you for the property loss, but your insurance check is only for the depreciated amount of the item. Depreciation is the decrease in an item’s value due to its age, condition, or other factors
Replacement cost value coverage reimburses you for the amount it would take to replace the item at the time you filed the claim. If you have this reimbursement provision and you file a claim, the insurance company first gives you the ACV of the item, and then the remaining amount once you replace it
A standard policy’s personal property coverage is ACV by default, but most companies give you the option to add RCV to your policy for a slightly higher premium.
Create a home inventory. Be sure to include descriptions, prices, and the quantity of items that you’re insuring. Keeping an inventory will help you determine how much coverage you need for your personal possessions, and it’s also something to point to when claiming a loss.
Personally property coverage, which costs around $1,200 annually, is included in every standard homeowners insurance policy. But your insurance costs could increase if you need an enhanced policy or a scheduled property endorsement for expensive valuables. If you collect art and vintage jewelry for a living, you may want to look into a standalone jewelry insurance policy that goes above and beyond even supplemental home insurance endorsements.
Your insurance costs will also be affected by whether you have an actual cash value or replacement cost policy. Actual cash value policies may have lower premiums and save you money in the short term, but could cost you in the long run if your stuff is damaged and you’re reimbursed with a measly claim check. On the flip side, replacement cost policies have higher premiums, but you have the peace of mind of knowing you’ll be paid for damaged items at their current worth, saving you the added out-of-pocket expenses.
You should also consider your deductible, which is the amount you pay to your insurer after you file a home insurance claim. The lower your deductible is, the higher your insurance premiums will be; the higher your deductible is, the lower your insurance premiums will be.
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