The most common misconception in personal insurance may be this one: belongings stolen from a vehicle are covered by the auto policy. They are not. Auto policies cover the vehicle and its permanently attached equipment. Your possessions inside it are personal property, and that is a homeowners, renters or condo question.
The general rule
Homeowners, renters and condo policies cover personal property anywhere in the world, subject to the same perils and deductible as property at home. That is a genuinely broad promise and it is what makes these policies more useful than people realize.
Two qualifications apply.
Off-premises property is usually limited to a percentage of the Coverage C limit. Commonly a fraction of the total, and it applies to everything away from the residence collectively rather than per item.
The sublimits still apply, and some of them are specific to being away. Jewelry, money, firearms and business property carry the same low caps off premises as on, and business property away from the residence is often capped even lower than business property at home.
Situation by situation
| Situation | Usually covered by |
|---|---|
| Laptop stolen from a car | Home or renters policy, subject to deductible |
| Suitcase stolen from a hotel room | Home or renters policy |
| Phone lost or dropped | Generally not covered; loss and breakage are not theft |
| Belongings in a storage unit | Home or renters policy, at the reduced off-premises limit |
| Property in a student's dorm | Often the parents' policy, at a reduced limit |
| Property at a second home | Usually a low percentage under the primary policy, or the second home's own policy |
| Tools used for work | Business property sublimit, which is low; often needs separate coverage |
| Property in a moving truck | Complicated; see below |
| A bicycle stolen from a rack | Home or renters policy, subject to deductible |
| Camera gear on a trip | Home or renters, or better, scheduled |
The deductible problem
Most items in that table cost less than a typical homeowners deductible, or not much more. A stolen laptop against a deductible in the same range is not a claim worth filing, both because the recovery is small and because filing affects claims history and can influence renewal. See will filing a claim raise my rate.
Two things follow. Off-premises coverage matters most for larger losses, such as a storage unit fire or a stolen bag of equipment. And for valuable individual items, scheduling is often the better answer, because scheduled personal property frequently carries no deductible and broader perils.
Storage units
Storage facilities are where this comes up most and where assumptions are most often wrong.
The facility's insurance does not cover your property. Storage contracts almost universally disclaim responsibility for the contents and require the tenant to carry their own coverage. Read the contract; many require it as a condition of the lease.
The facility's tenant insurance product is real but narrow. Facilities commonly sell a policy at the counter. It is typically limited in amount and in perils, and often excludes categories such as jewelry and documents. Compare it against what your existing policy already provides at the off-premises limit.
Some perils are excluded wherever the property is. Flood and earth movement are excluded from a homeowners policy, and a unit at ground level in a flood-prone area is exposed. Mold, vermin and gradual damage are excluded as well, and those are real risks in unconditioned storage. See flood insurance and the NFIP and mold coverage.
Long-term storage may raise a question. Some insurers treat property stored indefinitely away from the residence differently from property temporarily away. Ask.
Moving
Moving is the single riskiest period for personal property and the coverage is fragmented.
- A professional mover's liability is set by law and by the contract, and the default level of protection is typically calculated by weight rather than by value, which is a fraction of what most goods are worth. Full value protection is usually available for an additional charge.
- Your homeowners policy may cover property in transit for some perils, and coverage during a move between two residences involves questions about which policy is in force where. Notify your insurer of the move dates.
- A rented moving truck is a vehicle you are operating, which raises separate questions about liability and physical damage on the truck itself. See rental cars and borrowed cars.
- Breakage in transit is frequently excluded from a homeowners policy, which covers named perils for personal property, not everything that can happen to a box.
Call your insurer before the move rather than after, particularly if the move crosses state lines. See moving to a new state.
Travel
- Your policy generally follows you internationally for personal property, subject to the off-premises limit and the sublimits.
- Airline liability for checked baggage is limited by regulation and by the contract of carriage, and it is the first place to claim.
- Travel insurance covers different things, including trip interruption and some baggage loss, often with its own low limits.
- Credit card benefits may include baggage or purchase protection. Read the terms.
- Scheduled items travel best. Jewelry worn on a trip is exactly the situation scheduling was designed for, since the base policy's jewelry theft sublimit is low and mysterious disappearance is generally not covered at all.
Property in a vehicle, in detail
Because this is the most common case, it is worth stating precisely.
- Belongings stolen from the car: home or renters policy, personal property coverage, subject to deductible and sublimits.
- The broken window: auto policy, comprehensive coverage, subject to the auto deductible. See windshield and glass coverage.
- Permanently installed equipment such as an aftermarket stereo: auto policy, and often only if it was declared. See custom parts and equipment coverage.
- A child's car seat damaged in a crash: frequently addressed by the auto insurer as part of the claim, since manufacturers recommend replacement after a collision. Ask.
- Business tools in the vehicle: the low business property sublimit, and generally needing separate coverage. See commercial versus personal auto.
Expect two claims and two deductibles for a break-in that takes both the window and the contents.
Practical notes
- Know your off-premises percentage. It is on the policy form, expressed against the Coverage C limit.
- Inventory what lives away from home, including the storage unit and the second property. See building a home inventory.
- Schedule the valuable items rather than relying on the base limits.
- Report thefts to the police. Insurers generally require it, and the report is part of the proof.
- Keep receipts and serial numbers for portable electronics, which are the items most often stolen and the hardest to document after the fact.
- Renters need this most. A renter with no policy has no coverage for any of it, at home or away.
Off-premises percentages, sublimits, perils covered in transit, and how long-term storage is treated all vary by insurer, by policy form and by state, and the policy documents control. For your own situation, speak with a licensed agent or your insurer. You can also request home insurance quotes and get connected with licensed providers in your area.