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If you are the victim of theft, whether it occurs inside or outside of your home, your homeowners insurance coverage can help you to replace your stolen possessions. Your policy can also help you to cover repairs to any property damaged by a thief or burglar.
When Does Homeowners Insurance Cover Theft?
Standard homeowners insurance policies will cover your personal belongings if they are stolen inside or outside your home. Whether you are pick-pocketed in the street, or someone comes into your garage and takes your bike, you would be covered by your homeowners insurance policy. The most important thing for you to distinguish however is whether you are covered for Actual Cash Value (ACV) or Replacement Cost Value (RCV)].
ACV reimburses you for the amount your damaged or stolen item is currently worth, while RCV reimburses you for the amount it would cost to replace the same exact product in the current economic market. For example, if you bought your TV five years ago, its actual cash value may be $700 due to depreciation. However, you might need $1,200 to buy a new TV with the same features in the present day. As we will discuss more below, some high value items will have a limit to how much you may be reimbursed to replace them after being stolen. Examples include musical instruments, jewelry, electronics and cash. Whether you are reimbursed for ACV or RCV depends on the type of homeowners insurance policy you initially purchased.
Who is Protected from Theft Under Your Home Insurance Policy?
People listed under your policy will also have their personal possessions be covered against theft. This includes your spouse, and children, or anyone else identified on the policy, and extends to people living in different residences. Even if your child is at college and living on campus, they will be protected from theft should their electronics or belongings be stolen from their dorm room. You will need to talk to an agent for specifics, but generally once your child moves into their own home (not campus housing), they will no longer be protected from your home insurance.
Does Homeowners Insurance Cover Break-Ins?
Losses from break-ins fall into two categories, and they're generally both covered by your policy. The first is the loss of possessions, such as laptops and TVs. The second is damage to the physical structure of your house or detached buildings. The first loss is covered the same way as we discuss above. A burglar might kick in, pry off or otherwise damage doors, windows, locks and other areas of your home. Some target a very unexpected item: copper pipes, which they resell on the metals market. If you come home and find pipes have been stolen from your basement, your insurance can help with these costly repair bills. Any resulting water damage caused by the ruptured pipes due to a copper theft would be claimable as well under your policy.
What Types of Theft Doesn’t Your Homeowners Policy Cover?
Your homeowners insurance will cover mostly everything that can be stolen, with a few exceptions and caveats. Some things cost an above-average amount of money to replace, and for that reason, standard insurance policies limit the dollar amounts they will reimburse if these specific items are stolen. Two of those items are cash and jewelry. If your car is stolen, your homeowners policy will not cover that cost either. You need comprehensive insurance through an auto policy to be covered for car theft.
Homeowners Insurance and Stolen Cash and Jewelry
A homeowners policy can reimburse you for the missing money--but only up to a certain dollar limit. Usually, this limit is around $200. So if during a holiday someone steals your purse from the back of your chair taking $500 in cash, you would be covered for only $200. The problem with that however is if you have a $500 deductible to meet, you would not be able to file that claim because you don't even meet the threshhold. It is almost like paying $500 to get back $200 in cash.
Lost or damaged jewelry is another high value item that is limited to how much you are insured for. Your wedding ring might be worth $10,000. But if it is stolen, standard homeowners insurance typically would reimburse up to $2,000. If you have jewelry, antiques, art, coins or other possessions worth $5,000 or more, you may want to consider a “personal floater” policy. This coverage is added to your primary homeowners policy to help you insure rare or unusually high-value property.
Homeowners Insurance Doesn't Cover Car Theft
If your car is stolen, you need to have comprehensive insurance on your car insurance policy to be covered for that loss. Despite being a personal property or a belonging, a car is a completely different object to insurers, and gets its own insurance product. One major exception is if you have personal belongings that were stolen out of your car. If your luggage or other belongings were taken from your car, then you can claim a loss under your homeowners policy.
Homeowners Insurance Discounts For Theft-Proofing Your House
Taking measures to make your home "theft-proof" can net you savings in the form of homeowners insurance discounts. Many home insurance companies give discounts from 2% to 15 off the cost of premiums when you burglar-proof your home. Below you can see a few things you can do to earn the discounts:
- Use deadbolt locks on your doors ranked “Grade 1” by the American National Standards Institute (ANSI).
- Install burglar alarms connected to local police
- Install motion lights around the perimeter of your home
The measures may cost some money to install however--you will want to consider the cost of the installation and the savings from the discount. You should call your agent or homeowners insurance company to get an exact amount for the discount.