Does Homeowners Insurance Cover Theft?

Your home is more than a house. It’s where you make memories and store your keepsakes and other belongings. Homeowners insurance can help protect your home and property. But if theft occurs, will home insurance cover it?

Homeowners insurance can cover stolen items. What it covers and how much depends on your insurance policy. That’s why it’s essential to have the right coverage in place before disaster strikes.

Talk to your insurance agent if you’re not sure about your coverage. And if you’re looking for an excellent homeowners policy, Insurify can help. Get an insurance quote or compare home insurance rates and policies in minutes to get the right coverage to protect your home and belongings from break-ins.

When Homeowners Insurance Covers Theft

According to the Federal Bureau of Investigation (FBI), 18 percent of property crimes are burglaries. Luckily, standard homeowners insurance covers theft from inside and outside your home. It also covers items that you take with you when traveling.

That means home insurance can help replace stolen items if they were taken from your house or a hotel room.

Dwelling Theft Protection

The FBI reports that nearly 60 percent of burglaries involve forcible entry. If a thief breaks a door or window during a theft, will you be covered?

In most cases, your homeowners insurance will pay to repair or replace the parts of your home that are damaged during theft or attempted theft. Your dwelling coverage, also known as Coverage A, covers this type of damage.

Other Structures

Your home insurance covers additional structures under Coverage B in your policy. Other structures coverage can include detached structures, such as garages, sheds, and fences. If a thief damages those structures during a break-in, your policy can pay to repair or replace them.

Personal Property Replacement

If a thief steals your belongings, one of your first questions is: does home insurance cover theft of the item? Yes, a standard policy typically covers theft of appliances, furniture, clothing, sports equipment, and other personal property.

It’s under your policy’s personal property coverage, or Coverage C. Here’s when personal property coverage can kick in:

• Theft from inside your home or on your property: If a thief steals items from your house or property, personal property coverage can pay to replace the items.

• The stolen article belongs to a guest: Your homeowners insurance may cover a nonresident’s stolen personal property if the theft was from your house.

• A theft away from home: Your policy can help replace stolen luggage or other items while you’re away from home.

• Your child’s dorm room had a break-in: Coverage can include theft of items from a dependent’s dorm room. They may not be protected if they live in off-campus housing, so ask your insurance agent for clarification if you’re not sure.

• Items were taken from your car: Homeowners insurance generally covers the theft of personal items from your car. It will not cover the theft of your actual vehicle.

High-Value Items

There are some limitations to how much your home insurance company will cover. Your policy has a personal property coverage limit.

If you own high-value items, your policy may not be enough to cover them. Jewelry is a common example. Review your policy to determine if your coverage limit is high enough to replace the pieces that mean the most.

You can purchase an endorsement or additional coverage for more expensive items. This is an important consideration if you own expensive jewelry, art, or other valuables.

When Homeowners Insurance Doesn’t Cover Theft

Your insurance coverage won’t always cover a break-in. Insurers generally won’t cover theft of personal belongings if the home is vacant. If you live somewhere other than the insured house, contact your agent to ask about unoccupied and vacant homeowners insurance.

Your coverage won’t apply if you’re renting out your home and your tenant’s property is stolen. In this case, your tenant would file a claim with their renters insurance policy for reimbursement.

If you’re a victim of theft, it’s important to report the incident as soon as possible after it happens. Insurance companies may not reimburse you for the damaged or stolen property if you wait 60 or more days to file a claim.

How Much Does Home Insurance Cover for a Theft?

How much your policy covers depends on your policy limits. According to the Insurance Information Institute (III), homeowners policies generally limit coverage of personal belongings to 50–70 percent of your dwelling coverage.

Whether you have actual cash value or replacement cost home insurance is also a factor:

• Actual cash value ( ACV ) reimburses you based on the depreciated value of the stolen items.

• Replacement cost value reimburses the value of what a new item would cost.

To know the difference and how it might affect you, let’s look at an example. If a thief steals your TV, you’ll need to purchase a replacement. You paid $1,000 for the TV six years ago, and it was expected to last 10 years.

With actual cash value, depreciation would lower your TV’s value by $100 each year ($1,000 / 10 years = $100 per year).

Because it was six years old when it was stolen, you’d subtract $600 from the value of the TV. Your actual cash value policy would give you $400.

Replacement cost covers the cost of replacing your damaged item based on today’s market. If a similar TV was priced at $1,000, your replacement cost home insurance would reimburse you $1,000.

You must also consider your deductible. If your policy has a $500 deductible, you probably won’t file a home insurance claim with an actual cash value policy. That’s because the reimbursement amount may be less than your deductible. But replacement cost coverage might be worth paying a $500 deductible to replace a $1,000 TV.

Protect Your Home from Break-Ins

The III reports that a thief will move on if it takes more than four or five minutes to break into a home. Security devices and safety routines might be enough to slow them down and protect against being a victim of theft.

Here’s a checklist to increase home security:

• Install padlocks, deadbolts, and window locks.

• Invest in a burglar alarm, home security system, and security cameras.

• Put up exterior lights and motion detectors.

• Keep valuables out of sight and away from view through a window.

You shouldn’t list your address when advertising things for sale and avoid sharing your personal plans online. And if you see suspicious strangers in your area, notify the police and your neighborhood watch.

Adopting simple habits can also increase security and protect against break-ins. A routine can give you the peace of mind of knowing doors and windows are locked and alarm systems are turned on.

How to File a Theft Claim on Homeowners Insurance

If you’re the victim of a theft, you may need to file a claim with your insurance company. Here’s a step-by-step guide to the claims process:

• Report theft, vandalism, or burglary to the police. Make a note of the names of law enforcement officers you speak with and get a copy of the police report.

• Contact your insurance company to find out what coverage you have, if the claim will be more than your deductible, and how much time you have to file a claim.

• Don’t wait to fill out claim forms. Many home insurers can deny claims if you don’t file the forms within a specified time period. Return the forms promptly to avoid delays.

• If you have broken windows and doors from the incident, make temporary repairs. Be sure to take photos and document the damage before you make changes.

• Connect with the insurance adjuster to discuss the theft. Prepare ahead of time by making a list of stolen items and damaged property.

Don’t be afraid to ask a lot of questions when filing a claim. If your insurance agent isn’t giving you the answers you need, contact your state department of insurance. The National Association of Insurance Commissioners can help you locate the one nearest to you.

Is Theft Covered by Home Insurance? – Frequently Asked Questions

The Bottom Line: Check Your Coverage

Homeowners insurance policies include theft coverage. Most insurers cover theft if belongings are taken from a home, college dorm, hotel room, or car.

There are some restrictions you need to know. For instance, high-value belongings like jewelry or cash can have sub-limits different from the policy limit. Contact your insurance agent to ask questions and make sure you’re covered against theft.

One of the best ways to get the theft coverage you need is to shop around and compare rates. Insurify makes it easy. In less than five minutes, you can get quotes and compare rates to find the best insurance to protect your home and belongings.