What Is Personal Property Coverage?  

If you’re a homeowner, you’re probably familiar with home insurance and what it does. But while you may have your house protected, it’s important to remember you can protect the items inside your house, too, with Personal Property Coverage. 

Personal Property Coverage is intended to help reimburse the cost of your personal belongings if they’re stolen, damaged or destroyed under certain covered circumstances. It’s especially important for items that have high monetary or sentimental value.  

As we’ll discuss later in this article, Personal Property Coverage isn’t just for homeowners – it can also be added to a renters or condo insurance policy. 

What does Personal Property Insurance cover? 

Typically, if you have some form of home insurance policy, you won’t need to add Personal Property Coverage – it’s usually built-in as a percentage of your dwelling coverage. 

Homeowners Insurance 

A typical homeowners insurance policy includes Personal Property Coverage greater than or equal to 50% of the Dwelling Coverage, depending on your policy limits. For example: If your Dwelling Coverage is $100,000, you have $50,000 of Personal Property Coverage. 

If you’re a homeowner, you should create a household inventory list. It’s an itemized list of all your most important or valuable belongings that’ll help you decide how much Personal Property Coverage you need. 

If you’d like to learn more about Homeowners Insurance, we’ve written an article called Homeowners Insurance 101. 

Renters Insurance  

Renters insurance policies don’t have Dwelling Coverage. They provide Personal Property Coverage options separately, starting from $10,000. 

Condo Insurance  

Condo insurance is similar to renters insurance, except that some condo insurance policies allow owners to opt out of Personal Property Coverage. 

While individual unit owners can maintain their own Condo Insurance policies, the condo association will generally insure the building and defined common areas. The association’s policy generally does not cover personal belongings, and this is where Condo Insurance may provide coverage. If you own a condo, you’ll want to be sure to check the association’s policy and your own personal policy for more details. 

Personal property examples  

Personal property can be items that you deem valuable. Common examples include: 

• Jewelry 
• Musical instruments 
• Artwork 
• Clothing 
• Electronic devices and equipment 
• Tools 

Personal Property Coverage can also include items with sentimental or personal value, even if they’re not monetarily “expensive.” While these items may be irreplaceable to you, personal property insurance can help should anything ever happen to them. 

What isn’t covered by Personal Property Coverage?  

There are a few cases where personal belongings are not protected, even with Personal Property Coverage. 

• Lost items: Missing items may only be covered if there’s proof they’ve been stolen. Generally, things that you personally lose may not be covered.
• Floods and earthquakes: Items damaged or destroyed under these circumstances are not covered. 
• Wear and tear: Degradation over time is normal, and not considered an extenuating circumstance to warrant payout through personal property insurance. 

If you’re concerned about coverage for specific items, consider insuring those items separately. We’ll discuss that more in the section below. 

What is scheduled Personal Property Coverage?  

Scheduled personal property is separate coverage for specific, high-value items outside the coverage included in your home insurance. Essentially, you choose a valuable item and insure it on its own.  

This is important for items whose value may exceed the limits of your standard Homeowners Insurance or Renters Insurance. Home Insurance policies include sub-limits for categories of items, which dictate the maximum amount an insurer will pay for a damaged or stolen item. If you want to insure something that’s worth more than what your policy will pay for it, it’s a good idea to schedule it. 

Here are some examples of scheduled personal property items: 

• Artwork 
• Antiques 
• Collectibles (and full collections) 
• Jewelry 
• Musical instruments 
• Professional equipment 
• Medical equipment 

How much Personal Property Coverage do I need?  

The answer to this question depends on how many valuables you own, and whether their value falls within your standard policy limits. As stated, if you have high-value items that you’ve personally appraised, it’s probably a good idea to schedule them. 

There are two methods insurance companies use to value items at the time of loss: Actual Cash Value (ACV) and Replacement Cost. Here’s how they work. 

1. Actual Cash Value (ACV): ACV is the value of an item at the time it’s stolen, damaged or destroyed. This method includes depreciation into the value. 
2. Replacement Cost: The actual cost of replacing the item with a new item of almost identical value and quality. 

Here’s an example of how each works: Five years ago, you purchased a computer for $5,000. It was stolen a month ago. 

ACV calculation: 

• Original cost: $5,000 

• Depreciation: Let’s say the computer depreciates at 10% per year. 10% x 5 years = 50% 

• Depreciation amount: $2,500 

• Payout: $2,500 (subject to applicable deductible)

Replacement Cost calculation: 

• Original cost: $5,000 

• Payout: The insurance company will research the cost of new computers of equal (or close to equal) value and provide reimbursement. 

All policies come with different forms of coverage payout and not all losses are covered; coverage is subject to policy terms, conditions, and exclusions. Talk to a COUNTRY Financial agent today to see what type of Personal Property Coverage is best for you. 

Updated 5-1-24