What Are Contents?

• Contents are personal possessions that are not part of the structure of the home. Floor coverings provide an example. Wall-to-wall carpets that are professionally installed are usually considered part of the home's structure. Rugs are not permanently attached and are usually considered contents. The individual policy delineates what are contents and what are not.
  
  

What is Contents Insurance?

• Contents insurance is a type of insurance that pays for loss of or damage to an insured person's personal possessions when they are inside the covered person's home and in some circumstances when they are outside the home. As an example, some contents insurance may provide coverage in the person's car, a rental car or a motel room. The insurance policy's exclusions describe what is not covered and where it is not covered.
  
  

How is Contents Insurance Sold?

• Contents insurance is sold in at least of couple of ways. The first way is as an aspect of homeowners insurance, usually called personal property insurance. Contents insurance is also sold separately as part of what many call renter's insurance.
  
  

How Does Contents Insurance Differ from Personal Property Insurance?

• The personal property coverage contained within many homeowners insurance policies insures the home's contents and other personal possessions owned by the insured person and family members who live within the home. These belongings are covered to a value that is 50 percent of the value carried on the dwelling. For homeowners who own items with high value such as guns, cameras, art collections, jewelry, antique furniture and other valuable collectibles, the 50 percent of value may not be adequate coverage. The valuable possessions can be listed and insured with higher amounts to provide a better balance of property valuation to insurance coverage. This addendum to homeowners insurance is often called a rider. Separate contents insurance has no relationship to the value of the structure where it resides. Renters can also declare their high value items separately and insure them with their contents insurance.
  
  

What are Replacement Cost, Actual Cash Value and Agreed Upon Value?

• Replacement cost usually describes the dollar amount required to replace, rebuild or repair damages using like or similar materials with no deduction for depreciation. Actual cash value commonly means the dollar amount required at the time the loss occurred to repair, replace or rebuild minus depreciation. Agreed upon value is most often used for rare and valuable items. The insurer and the insured agree upon a value at the time the insurance is written and decide on terms of coverage for the specific possession.