Does Homeowners Insurance Cover Theft?

September 7, 2022

You pay for homeowners insurance, and now you want to know what it covers. Rather than just assuming any issues will be covered, you should talk to your insurance agent. In this article, we’ll cover theft and what your insurance might or might not cover.

Theft at Your Home

Typically, homeowners insurance covers theft that takes place at your home. As long as you have personal property coverage, you should be covered. This includes a few different scenarios:

  • Coverage for the damage that occurred to your home itself – This falls under your dwelling coverage. If the burglars broke windows or doors, your dwelling coverage will help with the cost of repairing and/or replacing the damaged features of your home.
  • Coverage for the items stolen – This falls under your personal property coverage. Each policy will have a different limit for this coverage, so make sure you review your coverage often. This part of your insurance should cover the repair or replacement of damaged or stolen belongings.

The Amount of Coverage

Just how much your insurance will cover depends on your policy. The dwelling coverage should cover the cost to replace the stolen items. The type of coverage you have for personal belongings makes a big difference, though. If you have replacement cost coverage, you may have enough coverage to buy the same item at today’s prices. If you have actual cash value coverage, you’ll receive reimbursement for the value of the item today (account for depreciation).

Every insurance policy also has limits, especially on personal property. You should know the limits of your policy intricately. This way you know if you have belongings that exceed the value of the proposed limit. If this is the case, you may need to take out an additional policy on those specific items in order to receive proper coverage.

The Deductible

Don’t forget, your insurance won’t kick in until you pay the deductible. Understanding how much your deductible is for situations, such as theft, is important. For example, if you have a $1,000 deductible, you are responsible for the first $1,000 in damages/loss before the insurance will help.

It’s a good idea to review your deductibles periodically to make sure they are something you can afford given your current financial situation. Your situation can change periodically, so it’s important to stay on top of these figures to know your worst-case scenario, should something happen.

Talk to your insurance agent about your personal property coverage to see how you are covered in the case of theft. If you are shopping for insurance, ask agents the cost of different coverage amounts so that you can get the maximum coverage that you can afford.