Theft and Burglary Insurance for Homeowners

Theft and burglary insurance financially protects your home and belongings in the event of damage or theft. This type of insurance coverage is typically an add-on or rider to your homeowners or renters insurance policy. Both theft and burglary insurance cover your losses if someone steals your home or possessions.

• Typically, the main types of coverage cover a range of common risks and liabilities.
• Exclusions and limitations on coverage
• How to file a claim if you experience theft or burglary
• Factors that affect your premiums
• Ways to potentially lower your premiums
• Top insurance providers to consider
• The benefits of bundling your policies
• Frequently asked questions

Having theft and burglary insurance can provide vital financial safeguards and peace of mind. Read on to learn more about how to protect your home.

Coverage Options

When purchasing theft and burglary insurance for your home, you’ll typically have a choice between named perils coverage or open perils coverage.

A named perils policy outlines specific types of theft and property loss it covers. For instance, it may only cover theft of jewelry, electronics, cash, and other valuables if someone steals them from inside your home. It likely wouldn’t cover theft of patio furniture or tools from your shed or garage.

Open perils, or comprehensive policies, provide much broader coverage. This type of policy covers any type of property theft on your premises, unless the policy specifically excludes or limits coverage for certain items or locations. An open perils policy would cover both theft of valuables from inside your home as well as lawn equipment taken from your garage.

In addition to the scope of coverage, theft insurance policies differ in coverage limits and deductibles. Coverage limits place a cap on the maximum payout you can receive for a covered loss. You can purchase higher limits for an additional premium, although many policies start with limits around $5,000-$10,000.

Deductibles require you to pay a specified amount out-of-pocket before the insurance coverage kicks in. Typical deductibles range from $250-$1000. Choosing a higher deductible lowers your monthly premiums but increases the amount you’ll pay in the event of a claim.

When selecting theft insurance, it’s important to consider your risks and assets to determine the best type of policy, limits, and deductible for your situation. An agent can help you review the options.

Typically, What Covered

Most standard home insurance policies include coverage for theft and burglary. These policies cover some common items.

• Jewelry – Insurance policies typically include coverage for theft of jewelry up to a set limit, such as $1,500 or $2,000. Higher limits may be available.
• Electronics – The insurance policy often covers laptops, TVs, stereos, and other electronics for burglary and theft, often up to the full value.. Keep records of purchases to document claims.
• Cash -Insurance policies typically cover stolen cash, often up to a few hundred dollars. Some insurers may require proof the cash was on the premises.
• Lock replacement – The policy usually covers the cost of replacing locks if there is a break-in. There may be a limit per lock.
• Damage from theft or burglary – Insurance generally covers repairs if a thief damages the home during a robbery.. This includes damage to walls, floors, doors, or windows.
• Items stolen from a storage unit – If you keep belongings in a storage unit offsite, they can be covered for theft depending on the policy.
• Unauthorized use of credit cards – If a burglar steals and uses your credit cards, there is coverage to reimburse you, often $500 or more.

Reviewing your policy details will help you understand exactly which personal belongings are covered and the coverage limits. This knowledge can give you peace of mind.

Also, Read : Fire and Lightning Insurance: Prepare for Nature’s Worst

What’s Not Covered

While theft and burglary insurance will cover the replacement and repair costs for stolen personal property and damage from break-ins, most policies contain exclusions. These are situations, perils, and losses that the policy does not cover.

Some common exclusions include:

• Floods – Typically, insurance policies exclude damage from floods, as they consider it an act of nature rather than theft or burglary, necessitating the separate purchase of flood insurance.
• Earthquakes – Most homeowner’s and renter’s insurance policies exclude earthquake damage, just like floods; a theft or burglary policy would not cover it.
• War – Damage from war is excluded. This includes damage from military uprisings, bombings, and other types of war events. Basic insurance providers consider war too catastrophic an event to cover.
• Nuclear hazards – Insurance companies exclude any damage from nuclear incidents, materials, radiation, or fallout.. This is because the extent of damage from nuclear events is too significant for standard policies.
• Government seizure – If the government or a public authority seizes or confiscates property, it will not be covered.. This is because it was not a criminal act of theft or burglary.
• Mysterious disappearance – If items go missing with no evidence of theft or break-in, the loss may not be covered. Most policies require signs of forced entry.

It’s important to carefully review exclusions when purchasing a new theft or burglary policy. Adding riders or endorsements can help cover some excluded perils like floods or earthquakes for an additional premium cost. But damages from nuclear events and war will likely remain uncovered.

How to File a Claim

Following these steps will help ensure that the claims process for theft and burglary insurance proceeds smoothly, even though it can seem daunting.

1. Report the incident to the police. Even if it seems like nothing was taken, having an official police report will help support your claim. Provide as many details as possible. Get a copy of the report for your records.
2. Notify your insurance company promptly. Call your insurance provider right away to inform them of the incident and that you’ll be filing a claim. There are usually time limits for filing so don’t delay.
3. Document the damage/missing items. Take photos or video of any damage caused during the theft or burglary. Make a detailed list of any items that were stolen, including their make/model, serial numbers, original purchase price and receipts if you have them.
4. Complete the claims forms. Your insurance company will provide you with the necessary claims forms to list the damage and stolen items. Fill these out thoroughly and accurately. Include any repair estimates you were able to obtain.
5. Submit a police report and documentation. Provide the claims adjuster with copies of the police report, photos/videos, list of stolen items, repair estimates and any other documentation that supports your claim. The more evidence you can provide the better.
6. Get in touch with contractors. For any repairs needed, be proactive in reaching out to contractors to get estimates. Submit these to your adjuster as you receive them.
7. Communicate with your adjuster. Your claims adjuster will investigate your claim, so maintain open communication. Respond promptly to any requests for additional information. This will help expedite the review process.
8. Accept or negotiate your settlement. Once the adjuster completes the review, they’ll provide a proposed claims settlement. If you agree with the amount, accept the offer and receive your benefits. If not, negotiate politely with them.

Following this step-by-step claims process and providing detailed documentation will give you the best chance of having your theft/burglary claim paid out quickly and fairly.

Also, Read : Home Insurance Claim Dos and Don’ts: A Helpful Guide

Factors Affecting Premiums

The cost of theft and burglary insurance can vary widely based on a number of factors. Some of the key considerations that impact your premiums include:

Location – Where you live is one of the biggest determinants of price. Urban and suburban areas with high crime rates will have significantly higher premiums than rural and low-crime neighborhoods. Homes in gated communities also tend to have lower rates.

Security System – Having a professionally monitored home security system can lower your premiums by 5-15% or more. Systems with cameras, motion sensors, 24/7 monitoring and rapid response times provide the greatest discounts.

Claims History – If you’ve filed multiple theft claims in the past, insurers will view you as high risk and charge accordingly. Too many claims can even lead companies to drop your policy altogether. Maintaining a clean claims history will help keep rates low.

Home Value – Insurers calculate premiums based in part on the value of your dwelling and possessions. More expensive homes with pricier belongings equal bigger potential payouts for insurers, so they charge more. Keeping valuations accurate and not overinflating can help control costs.

Deductible – Choosing a higher deductible is one of the simplest ways to reduce your premiums. The trade-off is you pay more out-of-pocket if you have a claim. Setting your deductible at $1,000 instead of $500 can result in significant savings.

Discounts – Most insurers offer discounts for bundling multiple policies (home, auto, umbrella, etc.) with them. Loyalty discounts for longtime customers and paying annually rather than monthly can also help lower rates.

Taking measures such as installing a security system, raising your deductible and asking about discounts can help offset the cost of theft insurance. But your location and claims history are locked in, so premiums are largely dependent on your unique risk factors.

Ways to Lower Premiums

When shopping for theft and burglary insurance, premiums can vary widely between providers. Here are some tips that can potentially lower your premiums for theft coverage on your homeowners or renters policy:

• Install a home security system – Systems that are professionally monitored 24/7 tend to result in the biggest discounts. Make sure the system has sensors on all entry points and motion detectors.
• Add extra locks – Upgrade to high-quality deadbolt locks on all exterior doors. Optionally add locking windows and sliding glass door pins.
• Create a safe room – Reinforce doors and add a loud alarm to a room you can retreat to in case of a break-in.
• Join a neighborhood watch – Being part of an active community watch program shows you’re serious about crime prevention. Attend meetings and volunteer for patrols.
• Install exterior lighting – Motion-activated security lights help deter break-ins. Illuminate all sides of the home, especially entry points.
• Trim shrubbery – Prune back bushes and tree branches to eliminate hiding spots around windows and doors.
• Get a dog – Many insurance companies offer a discount for owning a watchdog. Bigger dogs tend to qualify for bigger discounts.
• Show responsible ownership – Maintain your home, keep it occupied, make timely mortgage payments, and avoid claims on other policies. Financially stable policyholders tend to pay less.
• Choose a higher deductible – Opting for a higher out-of-pocket deductible before coverage kicks in can substantially reduce premiums.
• Bundle policies – You may get an overall discount on homeowners or renters insurance if you already have auto or life insurance with the same provider.

Reviewing these tips and taking relevant actions can potentially put you in a lower risk tier with insurance companies, resulting in significant savings on theft and burglary insurance premiums over time.

Bundling Policies

One of the easiest ways to save on theft and burglary insurance is by bundling it with your homeowners or renters insurance policy. Most insurance providers offer discounts of up to 15% for bundling multiple policies together. This discount applies because the insurance company sees less risk when covering multiple assets for one customer.

Bundling theft or burglary insurance with your homeowners or renters policy also provides simplified payment and paperwork. You’ll only have one insurance bill to pay every month or year, and if you ever need to file a claim, there will only be one adjuster and one claims process. Some providers even offer an all-in-one deductible when policies are bundled.

Even if your homeowners or renters insurance provider doesn’t offer stand-alone theft coverage. It’s worth inquiring about endorsements or riders that can be added to expand your core policy. This still allows you to bundle while getting the specialized coverage you need. With strategic bundling, you can gain valuable coverage for your valuables while also saving money.

FAQs

What does theft and burglary insurance cover?

Theft and burglary insurance reimburses you for the loss of your personal possessions if someone steals them from your home. This includes items like jewelry, electronics, cash, and collectibles. Damage to your home itself, like a broken window or damaged lock, is typically covered under your homeowners or renters insurance policy.

How do I file a theft or burglary claim?

Contact your insurance company as soon as you discover the theft or burglary. Provide details about what the thief stole and how they committed the theft, if known. You may need to submit a police report, proof of forced entry, and a detailed list of stolen items with approximate values. Your insurer will investigate the claim and require you to complete necessary paperwork.

What factors affect my premiums for theft coverage?

Several factors that can increase your premiums include: living in an area with high crime rates, having had past claims for theft or burglary, owning expensive possessions like jewelry or art, and having a history of late payments on your policy. Ways to potentially lower premiums include installing an alarm system, safeguarding valuables in a safe, and bundling your policy.

Is theft or burglary coverage required?

Theft and burglary coverage is optional and not required by most insurers. But it can provide important protection in the event of a costly burglary. Review your current homeowners or renters policy to see if theft coverage is already included or excluded. If not, consider adding this coverage for peace of mind.

How can I get discounts on theft insurance?

Ask your insurer about discounts for bundling your theft policy with other policies like auto or life insurance. Multi-policy discounts can range from 5-15%. You may also get discounts for being claims-free, installing security measures like deadbolts or alarms, choosing a higher deductible, and buying your policy from the same company you have other insurance with.

What items have special limits under theft coverage?

Most policies limit or exclude certain categories like cash, firearms, jewelry, silverware, furs, collectibles, and electronics. Special itemized coverage or riders are often required to fully cover losses for more valuable possessions. Review your policy details for any special limits that apply.