If you’re the victim of a robbery, you may wonder, “Does home insurance cover theft?” Fortunately, most home insurance policies do cover theft. Your policy can pay to replace your stolen belongings and repair any damage that happens to your home during the break-in.
What is covered
Personal Property coverage, also known as Coverage C, is a standard coverage within your homeowners insurance policy. This pays you to replace any personal belongings that have been damaged or stolen. Coverage is subject to the terms and limits outlined in your policy, so make sure you read it carefully.
- Furniture
- Bicycles
- Televisions
- Computers
- Electronics
- Clothing
- Musical instruments
- Sports equipment
- Appliances
- Jewelry
You may also wonder about these coverage questions:
Highly valuable items, such as jewelry and artwork, are also protected by your Personal Property coverage. However, the amount of coverage you have for these items may be limited. That’s because highly valuable items are more likely to be stolen. If you don’t think your coverage limits are high enough, you can purchase additional coverage to fully protect the pieces you value most.
Your personal items don’t have to be in your home at the time they are stolen in order to qualify for a home claim. For example, you’ll be covered if someone steals your laptop from your vehicle or hotel room.
Dwelling coverage, also known as Coverage A, is another a standard coverage within your homeowners policy. This is the coverage that will pay to repair or replace any damage to your home caused by the break-in.
Coverage amount
Most policies offer Personal Property coverage that is between 50% and 75% of the total insured value of your home. So, if your home is insured for $400,000, you should have between $200,000 and $300,000 of coverage for your belongings. Check the declarations page of your home insurance policy to confirm your coverage amount.
Personal item inventory
The best way to determine if you have enough Personal Property coverage is to create a detailed inventory of your belongings. This will give you an approximate value of your personal property in your home. An up-to-date inventory can also help a homeowners insurance theft claim get settled faster.
Follow these tips when creating a personal item inventory:
| Make a List |
| Write down how much you bought each item for, the year you bought it and any serial numbers (e.g., on appliances). |
| Document Damage |
| If possible, take pictures of the items and store them electronically. You should also keep original receipts. |
| Store It in the Cloud |
| Laptops can be stolen, so try keeping your list in a cloud-based digital folder that can be accessed from more than one device. |
Supplemental coverage
Most home insurance policies only cover highly valuable items, such as jewelry and furs, up to a certain dollar amount. Oftentimes, the value of these individual items exceeds the policy’s coverage limit. The good news is that you can purchase additional coverage to cover items to their full value.
- Jewelry
- Furs
- Fine art and antiques
- Stamps and other collectibles
- Manuscripts
- Firearms
- Cash and other securities
EXAMPLE
Let’s say your home insurance company has a $1,500 coverage limit for individual pieces of jewelry. If your $3,000 engagement ring is stolen, you’d get back $1,500, minus your deductible. That means you’d have to pay the rest out of pocket.
Fortunately, it is possible to purchase additional insurance for the theft of high-value items like an engagement ring. You can purchase one of these add-on endorsements:
- Scheduled Personal Property – Ensures full coverage of specific high-value items
- Blanket Jewelry – Offers coverage for multiple pieces of jewelry instead of just one
It’s worth noting that Scheduled Personal Property coverage usually pays out the full replacement cost of the item, while Blanket Jewelry coverage usually pays the actual cash value.
Actual cash value vs. replacement cost
Personal Property coverage usually insures the actual cash value of an item (i.e., its depreciated value), not the full replacement cost of an item. Here’s a quick explanation of the difference:
- Actual cash value – Pays you what the item is worth at the time of the theft. It factors in depreciation, which is how much an item decreases in value over time due to age and wear and tear.
- Replacement cost value – Pays you to replace the item with a brand new, similar item, without considering age or wear and tear. It is more expensive than actual cash value coverage.
Let’s say the laptop you purchased for $1,000 three years ago is stolen from your home. If your policy provides for actual cash value, you’ll receive what your laptop was worth at the time of the theft—which may only be $300 due to depreciation.
If you have replacement cost value, you’ll receive the value of a new laptop of the same type. In this case, you may receive $1,200 due to inflation.
