Protect your belongings with Replacement Cost Coverage

Families can rest easy knowing their tech, other goods are fully protected

By Edward L. Blais, JD, CIC
President, Blais Insurance 

From electronics such as iPads to sentimental jewelry, the Federal Bureau of Investigation estimates that thieves steal roughly $2,300 of valuable goods per home break-in. While it may seem like homeowners do not have any control in protecting themselves, we at Blais Insurance suggests adding replacement cost coverage to help mitigate losses and secure peace of mind.

To understand the value of replacement cost coverage, families would benefit from understanding exactly what homeowners insurance covers following a break-in. After a police report is filed, insurers will assess the extent of losses in a claim.

Once all of the necessary steps are completed, insurance companies send a check by mail to the policyholder. The amount of the check will vary depending on individual policy terms and the amount of recorded losses. It is here where disagreements can sometimes ensue.

Homeowners insurance can help cover some of the losses from theft through dwelling and personal property coverage. Dwelling coverage helps replace the parts of your home that were damaged from the break-in such as covering the cost of a broken window. On the other hand, personal property coverage helps cover the cost of stolen belongings minus depreciation. Insurance companies refer to this ‘qualifier’ in personal property coverage as Actual Cash Value (ACV).

To illustrate how Actual Cash Value works, imagine you own a lightly used MacBook Pro that retailed for $1,600. If the computer was stolen from your home, an insurance appraiser may only value your stolen item at half of the purchase price you paid.  

Replacing the computer then becomes a headache, but it does not have to become burdensome for homeowners. For a few extra dollars a year, homeowners can remove the ‘qualifier’ and have replacement cost coverage. Instead of paying the difference to buy back your device, replacement cost coverage would pay out the total cost to replace your stolen product with the newest model available.

No one expects to be the victim of a burglary, until it happens. Before a loss can occur, Blais Insurance encourages homeowners to strengthen their current insurance policy by adding replacement cost coverage. For more information or to learn how to protect your family from other losses, speak with a Blais Insurance agent at 401-725-0070.