What is Home Contents Insurance?
Home contents insurance, also called personal property insurance, pays for damage from an covered event, such as a water pipe bursting or a wind storm.
It's included in renters and homeowners insurance. It's hard to get as a stand-alone policy. But you can buy extra coverage on specific things or categories, such as jewelry and electronics.
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What home content insurance covers
Home contents insurance covers your belongings, such as your clothes, furniture, kitchenware, jewelry, firearms and electronics. If your property is stolen or damaged, your insurance company will pay to replace it.
It’s a good idea to get enough insurance to cover all of your things.
It’s usually called personal property insurance, and it protects your things when they’re outside of your home too. If someone steals your laptop from your car, or takes off with your suitcase from your hotel room, home contents insurance can cover it. Things in your garage and shed are also protected.
But there are limits: If you decide to get an insurance policy that covers only $10,000 worth of value, your largest possible payout is $10,000, even if your things were worth $20,000.
Who home content insurance covers
Renters and homeowners policies cover everyone who’s both at your home and related to you.
This includes your spouse, your parents, your in-laws and your children. For example, if your parents are visiting for a holiday and a pipe bursts, their damaged things are covered too.
Content insurance also protects people who live with you and work for you. If you have a live-in nanny, their things are protected.
But if you have a roommate, they’re not automatically covered. The same goes for a domestic partner and anyone who’s renting from you. You could add them to your insurance specifically or they can get their own coverage.
How much home contents insurance costs
Looking at how much renters insurance costs gives you a good sense of how much contents insurance costs, since most renters insurance is contents insurance.
The national average cost of renters insurance is $23 a month or $276 a year.
It includes home contents insurance and liability insurance.
The national average cost of homeowners insurance is much more expensive because it covers the building, not just your things inside. It costs between $1,450 and $5,287 a year, on average, depending on your house and location.
The price of covering your stuff also depends on if you want to get what's called the replacement value or the actual cash value of your things in a claim.
Say your laptop was stolen.
With replacement value coverage, you’d get a new one that’s a similar model. With actual cash value coverage, you’d get however much your laptop was worth if you sold it today. If your laptop was 5 years old, you likely wouldn’t get enough money from the payout to get a new model.
Replacement cost is better coverage but more expensive.
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Are there coverage limits?
Your home contents coverage has an overall limit, but often it has lower specific limits for expensive items or property outside your home.Sublimits can apply to high-risk, high-value things, such as electronics, jewelry, cash, collectibles, art, firearms and fur. If your renters insurance covers up to $10,000 in personal property, it may cover up to only $3,000 in electronics and up to $2,000 on any one thing.
What if you have a TV worth $4,000 or an $8,000 ring?
If those aren't fully covered, you can increase the total protection of your insurance, or you could get add-on coverage. Insurance endorsements increase your coverage on a category of stuff, and floaters up your coverage on a specific thing.
For another example, say your suitcase is stolen from your car. While stuff in your home is covered up to $10,000, stuff not in your home has lower coverage. The lower protection may be only 10% of your home contents coverage. In this case, your suitcase is insured for $1,000.
What isn’t covered in contents insurance?
Home contents insurance is meant to help you recover after something harmful happens.
But if you damage your own stuff, you’ll probably be on your own.
Personal property insurance likely won’t pay to replace things because of:
- Accidental damage: Such as spilling red wine on a white carpet
- Deliberate damage: If your teenager punches a hole in the TV
- Damage from neglect: Say you leave the front door open and a thief comes in
- Damage from contractors: Professional general contractors are responsible for their own work
- Normal wear and tear: Many things simply wear out over time
- Pet damage: If your dog chews up the furniture
- Pest damage: Imagine squirrels get into the clothes you stored in the attic
When these things happen, you may need to pay for replacements yourself.
Most policies also won’t cover things that are damaged or destroyed in an earthquake or flood. If you want this coverage, you’ll need to purchase it separately.
You can find earthquake and flood insurance through private companies.
But if you’re having a hard time getting flood insurance, check out the government website floodsmart.gov.
Frequently asked questions
How much home contents insurance do I need?
It’s a good idea to get enough coverage that you’d be able to replace everything if the worst happened. Within homeowners insurance, personal property coverage can be 50% to 70% of the dwelling coverage. For example, if you get $100,000 in coverage on your house, you could choose personal property coverage of $50,000 or more.
How do I get home contents insurance?
First, get an idea of how much coverage you want. Then get a few quotes. Select how much coverage you want and look for discounts, such as paperless billing. Compare the prices and coverages, and pick the best deal.
What are the advantages of home content insurance?
The advantage of home content insurance is that you won’t have to pay out of pocket to replace your things if they’re stolen or destroyed in many cases. Most policies cover events ranging from tornadoes to theft. Home contents insurance makes it easier to recover.
Does home contents insurance cover storage units?
Yes, home contents insurance can cover the stuff you keep in a storage unit. But your coverage limit may be lower, such as 10% of the coverage you have in your home. There are also some exceptions. State Farm notes that it might not cover any watercraft — so if you store a boat, you could need a special policy.
Sources and methodology
Information about insurance products is from the webpages of the National Association of Insurance Commissioners and insurance companies, including Allstate, Geico, Progressive, State Farm and Travelers.
The national average cost of renters insurance was built from quotes using addresses from the 25 biggest cities in each state. The national average cost of homeowners insurance was built using quotes for every residential ZIP code in the United States. Both used quotes from the top insurance companies.
Renters quotes are for a 30-year-old single woman who lives alone with no pets and has never filed a claim. Rates include the following coverage limits:
- Personal property: $30,000
- Personal liability: $100,000
- Guest medical protection: $1,000
- Deductible: $500
Homeowners quotes are for a 45-year-old married man with no history of home insurance claims and a good credit score. Rates include the following coverage limits:
- Dwelling coverage: $350,000
- Personal liability coverage: $100,000
- Medical payments: $5,000
- Deductible: $1,000
ValuePenguin's analysis of home rates used insurance rate data from Quadrant Information Services. These rates were publicly sourced from insurer filings and should be used for comparative purposes only. Your own quotes will likely be different.
Editorial Note: The content of this article is based on the author's opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.
