If you rent a vacation home, be sure you understand whether your possession will be covered in case of a loss due to fire, flood, theft or other event.
Check to be sure your homeowners or renters insurance has “off-premises” coverage. This means your personal possessions will be covered when they are outside of your home. You should be covered for items listed in your policy such as fire, theft, vandalism and hurricanes. Just remember, homeowners policies do not cover breakage or wear and tear to your possessions while in transit.
Some homeowners and renters policies limit off-premises coverage to 10 percent of the amount of coverage you have for personal possessions. For example, if you have $200,000 worth of coverage for your personal possessions, you would have $20,000 for off-premises coverage. If your off-premises policy limits are too low, you may want to purchase a policy with higher limits.
It’s always a good idea to create a vacation inventory of all the items you take on your travels. This is a great way to keep track of your possessions, especially if you have to file an insurance claim.
If you travel with expensive items, such as sports equipment, jewelry or a musical instrument, you may want to add a floater (endorsement) to your homeowners or renters policy. This supplement will cover the cost of specific high-value items whether you are at home or on vacation. A floater will also usually cover “mysterious disappearance,” which means you are covered if you simply lose the item.
Depending on the type of homeowners or renters policy you have, your possessions will be covered on either an actual cash value or replacement cost. Actual cash value covers the depreciated value of an item, not what you paid for it originally or what it will cost to replace. Replacement cost coverage will cover the cost of replacing the insured item, with no depreciation subtracted. And no matter what, you will have to pay your deductible first before your insurance kicks in.
For more information on protecting your possessions while enjoying your vacation home, please call E. R. Munro and Company at 1-877-376-8676 Monday through Friday 9 a.m. to 4:30 p.m.
