What is Contents Insurance?

Contents insurance is a form of insurance which covers the movable contents of a home or business, including things like furniture, electronics, clothing, and so forth. It may be sold with property insurance as home and contents insurance for homeowners, or as a standalone product for renters who wish to insure the contents of their homes and business owners who do not own the buildings they operate in. This type of insurance is a very advisable insurance product to buy, as it can be extremely costly to replace the contents of a home or business in the wake of flood, fire, burglary, and other events.

The cost of contents insurance varies, depending on the value of a structure's contents, the area, and the insurer. Generally it is fairly low, and often provided at a discounted rate if people buy it with other insurance products. For example, people can buy auto and contents insurance together at a lower rate. Getting a quote is free of charge, and will give potential customers an idea of what kind of costs they are looking at.

People should also be aware that not everything is covered under contents insurance. High value items such as jewelry and works of art may be excluded. For these items, special riders or separate insurance products will need to be purchased. Insurers do this to limit risk, recognizing that such items are more likely to be stolen or damaged, which can increase the liability for the insurer. Contents insurance also generally does not cover belongings which are owned by others; a friend who visits during a fire and loses a laptop, in other words, may not be covered.

Building contents insurance can also cover certain things outside the building, depending on the policy. This commonly includes things like gear which is used for traveling, such as bicycles, tents, and so forth, with the understanding that such “contents” are really used outside the home, not in it, and thus they should be covered on trips. This also can include protection for things stolen from vehicles while traveling, such as digital cameras and laptops.

When buying contents insurance, people should weigh the cost of the insurance product against replacement costs of the items which will be covered. They should consider factors like contents which will be excluded and the amount of the deductible. Before buying renters insurance, renters may want to check to see if their landlords are already carrying contents insurance on the property, and renters may want to ask if their landlords would consider adding contents insurance to their existing property insurance and raising the rent slightly to compensate if it can be obtained more cheaply that way.