Your Car is Covered But What About Your Personal Belongings?

Insurance is the tool all of us use to transfer risk. It is a simple process given the number of insurance companies in existence and the fact you can insure almost anything you own.

Take your automobile. Every state requires at least a minimum amount of coverage through a type of insurance called liability insurance. You can even obtain comprehensive and collision insurance on your vehicle.

If you have this type of coverage it is often referred to as full coverage. In other words, damage to your vehicle, damage to the other person’s vehicle is covered as well as medical payments and perhaps the cost of a rental vehicle while your vehicle is being repaired.

Personal possessions, on the other hand, you carry in your vehicle are not covered under your car insurance policy. This may come as a surprise to most people. They assume their cell phone, laptop, CDs and GPS unit is covered if stolen or damaged.

Their assumption is incorrect. The insurance company does not consider these possessions a part of the vehicle’s value. Therefore they are not covered. Losing them is traumatic for sure but regardless of the degree of trauma the insurance company won’t pay.

There is a way around this devastating news. That way is called home owner’s insurance. HOI becomes the silver lining in an otherwise dark cloud. Ask your agent for details because you may have to have a rider listing the specific items you wish covered.

Your best bet is to keep all the receipts for these items in a safe place at home. If you can, take photos or videos of the items. This shows you did have them plus it proves their condition before they were damaged or stolen from your car.

While you should always take as many safety precautions as possible to keep your possessions from being damaged or stolen, it isn’t a mistake to cover them with insurance. Call it a safety blanket if you will.