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The Coinsurance Clause & Moving Insurance.

April 23, 2018

If you have looked into moving insurance, it’s best to review your contract and make sure you fully understand it. If it includes a coinsurance clause, you may only be partially covered. Many people simply skim over the dense terms and sign an insurance contract without fully understanding what you’re agreeing to. Be sure you fully understand the clauses you might encounter in your moving insurance contract: the coinsurance clause.






Coinsurance refers to insurance in which the responsibility is shared. Specifically, if a loss occurs, the payment of the loss will be shared between the insured and the insurer.In essence; if something happens to your belongings, the insurance company pays a percentage of the loss, which leaves you responsible for the remaining amount.



Imagine you own a vintage guitar (let’s say, oh, I don’t know, a 1965 Fender Telecaster, in true “road worn” condition). It’s worth $8,000, but figuring that damage is more likely than complete destruction, you’ve decided to cut costs by insuring it for only $2,000 (or 25 percent of its real value).During the move, the armoire is damaged. The cost to repair it will be exactly $2,000.



The coinsurance clause means that the insurer only pays a portion of the loss – the percentage of value that you actually insured. In this case, that portion is 25 percent ($2,000 out of $8,000). So, the insurer pays $500 (25 percent) of the $2,000 damage. You pay the remaining $1,500.



When you receive any contract, make sure you understand it fully before signing your name to it. That little clause you didn’t think mattered might end up being crucial. Ask them questions, ask the provider exactly what the insurance will cover, and get it in writing, or email. A paper trail with proof of what policy information was exchanged will always expedite claim issues quickly. In short, if you want full coverage it will end up costing you more than a coinsurance policy. You get what you pay for, and if you are only paying for partial insurance, it will only be partially valuable.


YOU WANT VALUE: Direct Home Connect will work to relocate all of your home services, and utilities in a single call, saving you time and money. You won’t need an insurance policy for our services, in fact, you won’t even need to track down the providers to get these services setup at your new home. Click Chat with us to speak with a live representative today.

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