Is your stuff in a storage unit covered under your homeowners?

21 Jul
Home Insurance Protection and Storage Units

A standard homeowners or renters policy will usually cover personal property that is stored offsite from theft or damage as well as other disasters.

We are a nation of hoarders, and for many of us, our house just isn’t big enough to store all of our treasures, we need a little extra space. This is why roughly 10 percent of all American households rent a storage unit according to the Self Storage Association (SSA.).

But what happens if your storage unit is damaged or destroyed? Experts highly recommend that you call your insurance agent to make sure your personal possessions in storage are covered.

Luckily, in most cases it will be. A standard homeowners or renters policy will usually cover personal property that is stored offsite from theft or damage as well as other disasters. Policies vary so it is important to verify coverage, and the limits of coverage with your insurer.

In some cases, if the storage unit is poorly maintained, a claim may be denied and traditional restrictions also apply which means that flood, earthquake and damage from mold and mildew may not be covered. Check your policy and if necessary purchase a separate policy for flood or earthquake protection.

Coverage Limits Apply

While your homeowners or renters policy will usually cover your stored items, coverage limits almost always apply so you will need to carefully evaluate the value of your stored items.

Most policies limit coverage to 10 percent of your overall coverage on your home or renters policy. In the majority of cases this should be enough, but if you have a large storage unit, or are stuffing it full of expensive antiques, you may need to up your coverage limits to make sure you are fully covered.

The type of coverage you have can affect your stored items as well. If your policy is a cash-value policy, your insurer will only pay out the depreciated value of the item, which can be significantly lower than the replacement cost. A replacement value policy will replace your items at today’s prices. While a replacement value policy will cost roughly 10 percent more, it usually well worth the price.

Storage Facility Insurance

Most storage facilities offer their own insurance if you don’t currently have a renters or homeowner policy. The SSA reports that in some cases, 75 percent of renters purchase the optional coverage. Renters are not required to purchase the storage facility coverage but many do make some type of coverage a requirement of the rental agreement.

Experts advise reading the rental agreement and optional insurance document carefully. Coverage limits can be built into the agreement in order to limit the storage operator’s losses. A typical limit is $5,000, which will often not be enough to replace all of your items, especially if you have a large unit.

Industry experts also recommend keeping an up to date inventory of your storage unit contents. This will help speed up the claim process in the event of theft or complete destruction by a natural disaster or fire. There are a number of apps that can assist with an inventory as well as store a photo of your belongings.

Choose a Quality Facility

Carefully inspect a storage facility before moving your stuff into a unit. Be sure that it is safe and secure and there are no signs of rodents or bugs. Ask about their extermination policy and how often the facility is inspected and sprayed.

While it is not recommended to store valuables such as jewelry and artwork at a storage facility, if you do, make sure they are properly covered. Items such as jewelry and artwork usually have a value cap so if you have a very valuable collection you may need an additional rider for your policy. Contact your homeowners insurance agent for details on your particular policy.