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General Insurance Information
All interstate moving companies are required to assume liability
for the value of the goods which they transport. However, there
are different levels of liability and consumers should be aware
of the amount of protection provided and the charges for each option.
Most movers offer four different levels of liability under the terms
of their tariffs and pursuant to federally approved Release Rates
Orders which govern the moving industry. These four levels (options)
are described below.
Released Value
This is the most economical protection option available. This no-additional-cost
option provides minimal protection. Under this option, the mover
assumes liability for no more than 60 cents per pound, per article.
Loss or damage claims are settled based on the pound weight of the
article multiplied by 60 cents. For example, is a 10 pound stereo
component, valued at $1000 were lost or destroyed, the mover would
be liable for no more than $6.00. Obviously, you should think carefully
before agreeing to such an arrangement. There is no extra charge
for this minimal protection, but you must sign a specific statement
on the bill of lading agreeing to it.
Declared Value
Under this option, the valuation of your shipment is based on the
total weight of the shipment times $1.25 per pound. For example,
a 4000 pound shipment would have a maximum liability value of $5000.00.
Any loss or damage claim under this option is settled based upon
the depreciated value of the lost or damaged item(s) up to the maximum
liability value based on the weight of the entire shipment. Under
this option, if you shipped a 10 pound stereo component that originally
cost $1000, the mover would be liable for up to $1000, based on
the depreciated value of the item. Unless you specifically agree
to other arrangements, the mover is required to assume liability
for the entire shipment based on this option. Also, the mover is
entitled to charge you $7.00 for each $1000 (or fraction thereof)
of liability assumed for shipments transported under this option.
In the example above, the valuation charge for a shipment valued
at $5000 would be $35.00.
Lump Sum Value
Under this option, which is similar to Option 2, if the value of
your shipment exceeds $1.25 per pound times the weight of the shipment,
you may obtain additional liability coverage from the mover. You
do this by declaring a specific dollar value for your shipment.
The amount you declare must exceed $1.25 per pound times the weight
of the shipment. The amount of value that you declare is subject
to the same valuation charge ($7.00 per $1000) as described in Option
2. For example if you declare that your 4000 pound shipment is worth
$10,000 (instead of the $5000 under Option 2), the mover will charge
you $7.00 for each $1000 of declared value, or $70.00, for this
increased level of liability. If you ship articles that are unusually
expensive, you may wish to declare this extra value. You must make
this declaration in writing on the bill of lading.
Full Value Protection
Many interstate movers offer a fourth level of added-value protection,
often referred to as "full value protection" or "full
replacement value". If you elect to purchase full value protection,
articles that are lost, damaged or destroyed will be either repaired,
replaced with like items or a cash settlement will be made for the
current market replacement value, regardless of the age of the lost
or damaged item. Unlike the other options, depreciation of the lost
or damaged item is not a factor in determining replacement value
when the shipment is moved under full value protection. The exact
cost for full value protection may vary by mover and may be further
subject to various deductible levels of liability which may reduce
your cost. Ask your mover for the specific details of its plan.
Under these four options, movers are permitted to limit their liability
for loss or damage to articles of extraordinary value, unless you
specifically list these articles on the shipping documents. An article
of extraordinary value is any item whose value exceeds $100 per
pound. Ask your mover for a complete explanation of this limitation
before your move. It is your responsibility to study this provision
carefully and to make the necessary declaration.
These optional levels of liability are not insurance agreements
which are governed by state insurance laws, but instead are authorized
Released Rates Orders of the Surface Transportation Board of the
U.S. Department of Transportation.
In addition to the above options, your mover can also sell you,
or procure for you, seperate liability insurance if you release
your shipment for transportation at a value of 60 cents per pound
per article (Option 1). Then, in the event of loss or damage which
is the responsibility of the mover, the mover is liable only for
an amount not exceeding 60 cents per pound per article and the balance
of the loss is recoverable from the insurance company (up to the
amount of the insurance purchased). The mover's representative can
advise you of the availability of such liability insurance and the
cost. If you purchase liability insurance from or through your mover,
the mover is required to issue a policy or other written record
of the purchase and to provide you with a copy of the policy or
other document at the time of purchase. If the mover fails to comply
with this requirement, the mover becomes fully liable for any claim
for loss or damage attributed to its negligence.
Important Notes
- Check your homeowner's insurance. Some policies cover property
in transit.
- Consider purchasing short-term insurance that covers the move
if your property is very valuable.
- Unlike most property insurance, valuation does not automatically
pay for any damage. It must be clearly shown that the mover was
responsible for the damage.
- Items in boxes not packed by the mover are not covered, unless
the outside of the carton provides clear evidence that the entire
box was damaged during the move.
- The mover is responsible for any electronic item that does not
function after the move only if there is clear evidence that the
item was dropped or mishandled during the move.
- The customer has nine months after the move to file an initial
claim against the mover.
- The mover is legally obligated to acknowledge any claim within
30 days and to resolve it or offer a settlement within 120 days.
- The customer is legally responsible to pay for the move, even
when claiming extensive damages. The customer must go through
the claims process to receive compensation for any damages.
- If a settlement cannot be reached, the customer either can sue
the mover or seek arbitration.
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