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When Purchasing Floating Home Insurance Coverage May Be Necessary

2010-05-08

A home is not only the four walls, basement and roof that make up its structure, but also an amalgamation of the people and items that are inside. Home insurance coverage at its most basic level will only cover damages to the structure of the building, but more comprehensive levels can be purchased to take care of a larger range of "perils," including items that are located in the home. This broad coverage, as it is commonly known, is offered in almost every state and offers at least some protection against vandalism or theft of items in a home.

There are situations, however, when the coverage offered by home insurance providers is not sufficient to pay for all of the items in a home, or to cover several large and expensive items. In this case, a "floater" add-on, or "floating insurance" addition to a homeowners insurance policy may be a viable option. This should not be confused with the insurance taken out for a floating home, but rather an addition to an existing home insurance policy aimed at keeping items secure. Floating policies are used to insure items which lie above and beyond the scope of a normal insurance plan, due to their value or rarity. These policies typically result in a significant increase to the monthly premium paid by a homeowner, but can be worth the cost if any of the items covered are damaged or stolen.

Items on a floating insurance policy are listed individually and often require individual appraisals to be listed. Even if they do not, having a current appraisal on file with the insurance company is a good idea in case the policy ever needs to be used, as documentation showing the recently determined value of the item can avoid headaches in the long run. In addition to covering these items in the home, a floating policy will often also cover them if they are moved or stored at a different property. This is because they are not technically covered as part of the home policy, but rather a separate add-on that takes care of the items themselves and not their location. This means that the items can be moved if necessary without fear of their coverage becoming null and void. It is a good idea to inform the insurance company before any items are moved.

Many homeowners have no need for floating insurance on their home insurance coverage as the added cost does not balance out against the replacement value of the items in their home, or because the threat of damage to their items is comparatively low. In cases of high-value items or high-profile homes, this floating add-on may help keep valuable property high and well-protected.