Your homeowners insurance policy may cover losses from specified risks such as fire and theft while your goods are moved. But the policy probably won’t cover the types of damage likely to be caused by a mover—for example, scratches or breakage from careless handling. Your mover is theoretically liable for such damage while the items are in its control, but most movers’ contracts routinely limit their liability. For long-distance interstate moves, your options are fairly straightforward; for local moves, the options are more muddled. Make sure you fully understand the various options before making a choice.

Long-Distance Interstate Moves

There are several forms of protection against loss caused by long-distance interstate movers:

Full Value Protection

Interstate movers must offer plans that cover the full cost of repair or replacement of lost or damaged goods. Each carrier sets its own price for this protection, typically about $9 per $1,000 of coverage. By agreeing to a deductible, you can dramatically reduce the cost; for example, if you agree to a $250 deductible, your rate may drop in half, to about $4.50 per $1,000 of coverage.

You can decide at what level to value your goods, as long as the minimum level of protection is at least $5,000 and at least equal to the number of pounds of the shipment multiplied by $4. For example, if you decide to get $50,000 worth of coverage, expect to pay about $450 for the no-deductible level of liability, or about $225 with a $250 deductible.

Released Value

To avoid paying the added valuation charges, you can buy very limited coverage based on the weight of each item. Under this option, if an item is damaged or lost, you are reimbursed for repairs or replacement up to the actual value of the item, subject to a limit of $0.60 times the item’s weight in pounds. Under this option, you receive only $6 as compensation for a 10-pound item, although its value might be much greater. This level of coverage costs nothing, but to get it you must specifically request it on your bill of lading.

Separate Liability Insurance

Some movers sell separate liability coverage through a third-party insurance company. While the other forms of protection are referred to as “valuation protection,” this kind of coverage is properly referred to as insurance and regulated under state law. If you buy such insurance, the mover is liable only for up to $0.60 per pound per article (as in released value coverage). If your claim exceeds this amount, the remainder is paid by the insurance company.

When you purchase separate liability insurance, the mover must provide a copy of the policy or a record of the purchase. Otherwise, the mover becomes fully liable for any claim for loss or damage due to its negligence.

Local Moves

You can determine a local moving company’s liability for damage to your goods by examining its bill of lading and other documents it provides.

Many companies will drastically limit their liability—for example, to a $0.60-per-pound level comparable to the “released value” option on long-distance interstate moves—and try to sell you additional coverage. Some companies include the cost of damage coverage in their regular rates. Be sure a company’s coverage for damage is set out in writing on your bill of lading or in some other document.