As a removal company, we know understanding Insurance for House Removals can be pretty tricky. If you’re using a professional removal firm most will talk to you about insurance, but it can be hard to understand the level of protection your cover provides because a lot of removal companies handle insurance in many different ways.
In this article, we’ll try to explain how it works and answer some frequently asked questions to help you make an informed decision on how to cover your possessions.
Let’s start with the background…
Do I need insurance for moving house?
Removals insurance is a bit like travel insurance
While it might be tempting to cut your overall removals costs when you move by opting out of an insurance policy, the price you ultimately pay might be even higher in the long run.
Much like when you book a holiday and consider travel insurance in case of ill health or an accident, moving insurance is an optional extra. Hopefully, you won’t need it, but:
if you do, the small premium you pay gives you peace of mind that if something goes wrong you’re financially protected from what could be much higher costs to repair or replace your belongings.
Most professional removal companies have a great record when it comes to looking after their customers belongings, and have low levels of damage (Bournes recently scored below the industry average of 8% claims levels with just 6% in our recent FIDI audit) BUT those removal companies who have even just a little experience are realistic enough to know that accidents do happen.
Don’t you have to be insured as a business to undertake removals? Am I covered by that?
An insured removal company does NOT always mean an insured customer.
Most removal companies have to insure themselves with various policies to conduct their work so many will advertise they are ‘fully insured’. This means THEY are insured, but not always YOU.
This is the bit hard to explain, but we'll try.....Typically, removal companies will discuss the risks of doing business with their insurer and pay a premium to them that covers them for the likelihood of that risk. Because your removal company may not know the value of your items at the time of moving and because sometimes things can happen that are outside of our control, it is standard practice for removal companies to limit their liability for damage under their terms and conditions.
As insurance premiums (like all costs of business) are built into a company's prices this means those that limit their liability don’t have to build a level of cover that you might not need into your removals charges, pushing that price unnecessarily higher. Instead, they make this cost visible to you allowing YOU to decide the level of cover you need and pay for that accordingly, or if you want to opt-out you do so knowing that you carry some of your own risk.
This level of liability should be set out in your removal company's terms and conditions and it’s very important to check you are comfortable with this level of protection before signing your contract. (SIDE NOTE: If you don't have a written contract with your removal company you are putting yourself at high risk in the event things don't go to plan, insist on a written agreement or find another mover. All BAR members must provide a written contract as standard).
How am I protected in the event of damage under basic removals terms and conditions?
Every removal company has their own terms and conditions so Liability, Extended Liability, Standard Liability etc. can all mean different things.
So you need to check the terms and conditions of the companies you are considering to be sure, but here's what to think about:
If you’re comparing quotes you may see that some removal companies include ‘standard liability’ or ‘extended liability’ within the price for your move. This isn’t usually standalone insurance, it’s often the liability the removal company is willing to accept in the event of a claim, subject to their terms and conditions.
As with all other types of insurance, it is important to check you’re happy with the terms and conditions and the process for making a claim, particularly where this is included in the base price of your move. Things to look out for are:
- Is the liability subject to you proving the company was negligent or did not fulfil their contract?
- Is there a maximum claim cap per item or total claim?
- How is the value of the claim calculated?
The final thing to find out is what happens in the event of a claim. Who are you negotiating your claim with? The removal company or an independent insurance company? How long do you have to claim? What will you need to do? What happens if you don't agree with an outcome?
So why is Removals Insurance different to a liability cover?
Many professional removal companies offer comprehensive standalone Removals Insurance cover as an additional product.
Some removal companies will offer you the opportunity to increase your level of protection by paying for insurance cover in addition to your move which may more accurately reflect the level of cover you need. If you choose to take out this cover some of the terms and conditions that apply under your basic contract (see above) are waived and you should be provided with an additional set of insurance terms and conditions detailing the level of cover you now have in place.
Just like travel insurance there are different levels of cover available to you and could vary between removal companies, so it’s important to check with your mover what cover they are offering.
There are two most common levels of cover (which are the ones we offer at Bournes) Indemnity Insurance or New for Old Insurance. Indemnity insurance typically provides cover for up to the true value of the item damaged allowing for its age and condition regardless of whether the accidental damage was the mover's fault or something out of their control.
Some companies also offer a ‘new for old’ policy upgrade to cover replacement of the item as new rather than taking into account age and condition. With both types of policy its important to check any exclusions as again, these will vary between removal companies, for example, some may include pairs and sets or mechanical derangement, others will not.
These are policies arranged on your behalf with an approved insurer. Your removal company may decide to settle your claim immediately in house, but if it is referred onto the insurer it will be ultimately assessed and handled by them independently. This ensures any disputed claims over negligence or settlement are unbiased giving you peace of mind the assessment is fair and reasonable.
What if I'm covered under my home contents insurance policy?
It's not always a good idea to rely on your home contents insurance policy
Some home contents insurers also provide cover for moving to a new house, HOWEVER, it’s important to double-check the terms and conditions of your home insurance before assuming this is the case.
- Are there any excluded items from cover or any per item claim limits?
- If your move involves two stages (old house to storage and storage to new house), are you still covered including the storage, or is that a separate cost?
- Are you only covered if you use a professional mover, and do they stipulate what a professional mover is? (i.e. certifications or membership of industry bodies, are they regulated by the Financial Conduct Authority)?
- Is there an excess for your claim?
It’s also important to assess what happens in the event of any damage – is it easy to make a claim and would a claim increase your future insurance premium?
Our final removals insurance tip:
I think we might have said this a few times, but just in case we didn't make it clear:
Make sure you fully understand the terms and conditions and what the insurance you are buying covers. Be careful to look for any limitations (such as the value of your claim or your requirement to prove negligence), especially if this is stated as ‘included’ in your removal quote.