What is Contents Insurance?

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What is Contents Insurance? 

<lingo>Sometimes described as personal property insurance, contents insurance covers the personal possessions of the insured that are located in their home. Some contents insurance policies will also cover these personal possessions while they are away from the home, for example, when packed for vacation or traveling. Contents can be wide-ranging, including clothing, furniture, appliances, toys, books, jewelry, bedding, electronics and more. The vast majority of contents insurance policies have limits that set a total amount of the losses that may be claimed following a covered event. Contents can be covered from a loss due to fire, water or storm damage and even theft.</lingo> 

Contents Insurance Briefly Explained 

Contents insurance is usually a part of a person's homeowner's policy. While the significant portion of a homeowner's insurance policy is designed to cover the structure of the home in a covered calamity, contents insurance is designed to cover the personal possessions located inside of the home. This is important coverage for several reasons. First, most people own more personal possessions than they realize and replacing those possessions can be quite expensive. Even a family's wardrobe can cost thousands of dollars to replace. The other reason is that personal possessions can receive extensive water and/or smoke damage from a storm or fire.

 

<twitter>Contents insurance is usually a part of a person's homeowner's policy. While the significant portion of a homeowner's insurance policy is designed to cover the structure of the home in a covered calamity, contents insurance is designed to cover the personal possessions located inside of the home.</twitter>

 

 

Even a small fire can result in severe damage to furniture, bedding, clothing from the fire, smoke, and water used to extinguish it. It is important to know the limits of a contents insurance policy, especially where the insured may have a valuable collection like a coin, stamp or antique collection. Such extensive collections may not be fully included under the basic coverage of a contents insurance policy and an additional rider may be needed to expand coverage. Since it is easy to lose track of an individual's numerous personal possessions when making a claim, it can be valuable to keep an updated written or video inventory of these possessions and store that inventory off-site. Depending on the specific coverage, personal items are either valued on the cost of their replacement or on the value after deducting for age and wear and tear. 

 

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