When a loss occurs, most insureds can tell you the big ticket items they own: 2 – 48” HDTV’s, 4 Laptops, etc. But what about the lesser items we use every day? Could an insured tell you: how many glasses they have in their kitchen cabinets, how many picture frames are throughout the house, how many pairs of shoes does Mr. Insured’s wife own, what kind of golf clubs does Mrs. Insured’s husband own? This month, we are going to look at ways to provide coverage for an insured’s contents within our Beacon Homeowners programs.
In the event of a loss, an insured can save precious time and effort by having a home inventory already in their records. Of course, items come and go but this is a valuable resource to recall what is in the home and it can even track what is kept in each room and closet. For information about creating a content inventory, please see our blog How to Create a Home Inventory.
Coverage C – Contents Coverage: Contents coverage is included in the policy at 50% of Coverage A at no additional premium. However, coverage is only afforded for specific named perils at actual cash value and there are special limits of liability for certain items such as jewelry and silver.
Personal Property Replacement Cost Loss Settlement Endorsement (HO 04 90): This optional coverage affords the insured with the replacement cost value of items lost versus actual cash value. But, it does not remove the special limits of liability from the standard policy language and coverage is still only available for the specific named perils.
Special Personal Property Coverage (LPIC 155 in Louisiana and LHSC 115 in South Carolina):Selecting this endorsement changes the perils covered for contents from named peril to all peril coverage. Bear in mind, all peril does not mean there are no exclusions nor does it remove all limitations within the policy for specific content categories. Additionally, because of the nature of this coverage, there are specific eligibility guidelines regarding year built, coverage limit, occupancy, and claims history which can be found in the underwriting manual.
Scheduled Personal Property Coverage (LPIC 156 in Louisiana and LHSC 114 in South Carolina): Because the policy restricts the maximum amount covered for certain content classifications, this coverage allows the insured to list specific individual items on the policy and receive all peril coverage, with some exclusions, on the listed items. Appraisals or bills of sale are required for many items and there are eligibility guidelines regarding the total value of the schedule, occupancy and this coverage may require security systems. A detailed guide of eligibility rules and documentation requirements can be found in the underwriting manual.
Please note, not all coverages are available in all programs or states. The information provided here is only applicable to Lighthouse Property Insurance Corporation and should not be construed as underwriting guidelines for general knowledge.
Written by: Jennifer Vazquez, CPCU