Does My Homeowners Insurance Cover a Storage Unit?

Does My Homeowners Insurance Cover a Storage Unit

If you are a homeowner, getting a homeowners insurance policy can financially protect your house from theft, burglary, fire, or natural disasters. 

A standard homeowners insurance policy covers your house, attached structures like a garage, and unattached units like a shed inside your property. It will also protect your personal belongings that are kept inside the house.

While most homeowners’ insurance would cover personal property, like jewelry, furniture, clothes, appliances, and other expensive items kept inside the house, it will cover them on a limited basis when kept in a storage unit away from home.

Belongings kept in a separate storage unit can be covered but need to be contemplated within your personal insurance coverage.

What can a standard homeowners insurance cover?

A standard homeowners insurance policy coverage can include repairs and replacement of your house and belongings in the event of damage. 

Loss and damage to a home can happen due to a fire, smoke, theft, burglary, or natural disaster.

Here is a list of the personal belongings kept inside the house that comes under the insurance coverage:

  • Appliances
  • Clothing
  • Furniture
  • Arts and expensive items
  • Jewelry
  • Bikes
  • Carpets and rugs
  • Household appliances and equipment like  a television and lawn maintenance equipment

While the personal items kept inside the house are covered subject to the policy limit, a typical homeowners insurance policy shall provide limited coverage for the personal property stored in a storage unit.

Coverage limit on off-premises storage of personal property

Where the insured’s personal property is kept outside the insured premises in a separate storage unit, the insurance coverage would be limited to 10% of the total personal property coverage.

For instance, if you are getting a personal property coverage of $100,000 from your homeowners insurance, the coverage of personal property in a storage unit outside your home would be limited to $1,000 minus your deductible.

To raise the coverage limit, you need to increase your insurance policy coverage, which would increase your premium; otherwise, you can get separate insurance from the storage facility.

Theft-Only Limits

Where a homeowners insurance policy covers your personal property only when loss results from theft or burglary and other perils.  However, property damage due to flood, mold, or animals will not be covered.

In such cases, you may be able to purchase extra coverage from your storage facility.

Limits on High-Value items

Insurance companies typically recommend not storing high-value items in a storage unit away from home. Precious and often rare items like priceless jewelry, art, and heirlooms are not covered by storage unit insurance because of their high value and increased risk of theft.

Getting an endorsement via your homeowners insurance policy can be a good idea if you want to store such items in a storage unit.

Endorsements or riders are add-ons to your existing homeowners insurance policy to increase the coverage limit on high-value items that were otherwise not included in the insured’s personal property.

Endorsements may not need deductibles, but you might have to get each item professionally appraised to determine the property’s value before applying for the endorsement.

Storage Insurance Policy

Storage unit coverage is sometimes included in a homeowners or renters insurance policy. If it is not, and you have items of value in a storage unit, it is wise to consider a stand-alone storage insurance policy. Or an add-on endorsement to a primary homeowners insurance or renters insurance policy. Most self-serve storage facilities require customers to have coverage for items in their storage units. 

A storage insurance policy can be a good idea when storing your personal property outside your home in a storage facility. The insurance will cover any loss due to theft, burglary, or damage.

Storage insurance has specific rules and restrictions and a higher rate than homeowners insurance. It has a coverage limit, and premiums are calculated monthly.

In case of property damage, storage insurance shall reimburse the loss or damage covered by the policy. Reimbursement will be made based on the cash value of the damaged property and not on the replacement value.

Damage or loss of personal property kept in a storage unit shall be covered when loss/damage occurs because of:

  • Theft
  • Burglary
  • Water damage
  • Fire
  • Wind
  • Smoke
  • Natural disasters like hurricanes and tornadoes
  • Storms, hail, and lightning

The following are excluded from coverage:

  • Earthquake
  • Flood
  • Mold and mildew
  • War & Civil disturbance
  • Vermin

Other ways to protect items in storage.

Storing personal property in a storage facility comes with risks. Even when the property is insured, you cannot get back the irreplaceable items if damaged in storage.

Here are some steps you can take to protect your personal belongings when stored in an outside storage facility.

Choose the right storage unit.

Before storing your precious belongings, check whether the storage facility is suitable for you. Do research regarding the company’s history and go through customers’ reviews and complaints to get an idea about the quality of service offered.

Check the security of the facility.

Make sure the facility has security measures like 24/7 surveillance cameras and high-quality security locks on the storage units to prevent theft and burglary.

Use storage units with water and fire protection.

Before storing your possessions, make sure the storage facility has no risk of flooding. Check if they have fire safety measures in place and whether they have protective measures like climate-controlled storage units and vapor barriers to keep your belongings free from moisture.

Keep the access code a secret.

To avoid theft, keep the access code to the storage unit to yourself and avoid sharing them with strangers. Avoid jotting it down on a piece of paper where it can be easily copied, and store it in your phone with password protection.

Keep a record of your possessions.

Take a picture or video of your possessions to keep an inventory of the contents of the storage facility. It will help you keep track of the contents when you make a claim.

Other tips:

  • Avoid storing your possession in plastic bags as that can block ventilation and attract mildew.
  • Do not store rare, precious, and irreplaceable items in a storage unit.
  • Store personal items on a pallet, providing both ventilation and security.

Storing personal belongings in an external storage unit is never risk-free. You can take adequate insurance coverage to mitigate the risk of loss or damage to such items.

Remember, increasing your homeowners policy limit would provide better coverage than getting storage unit insurance.

Also, while insurance can reimburse you in the event of a loss, it is better to store irreplaceable items where they are least likely to get damaged.

If you have questions about your homeowners insurance policy, contact the Insurance Center of North Jersey at 201-525-1100.