Transit Insurance When Moving House: Do You Need It?

Arriving at your new house or apartment after a move only to discover your furniture has been broken, your glassware has been chipped, or some of your clothes have gone missing can be a disappointing and costly experience.

If you have an existing contents insurance policy, it may include cover to protect your belongings while in transit. But, if not, there are other insurance options you can consider.

What is transit insurance?

Transit insurance can help provide a level of financial cover for your possessions if they are damaged and/or lost while they are in transit to your new home.

Transit insurance can be purchased as a standalone product from a specialist insurance provider, removalist or freight/shipping company. Some transit insurance policies may include similar coverage to a contents insurance or removalist insurance policy. However, these are different types of insurance and should not be confused with each other.

What does transit insurance cover?

The cover provided by transit insurance differs depending on the policy. It may cover:

• Loss or damage to your goods during packing and unpacking
• Damage or loss to your goods while being loaded or unloaded
• Loss or damage to your goods while in transit (e.g. caused by road accidents, fires, derailment, theft, impact or malicious damage. Also the grounding of vessels, crashes and forced landings for aircraft)
• Damage or loss to your goods caused by removalist mishandling
• Incidental storage costs
• Alternative accommodation expenses, if required

The policy may be for international or domestic moves, based on your requirements.

How can you get transit insurance for moving house in NZ?

There are several options available for insuring your belongings during a move, including:

• Contents insurance
• Removalist insurance
• Standalone transit or moving insurance

Contents insurance

Contents insurance policies differ when it comes to cover for your belongings in transit. Some insurers do provide a level of cover for your contents if damage or loss is caused by events such as fire, flood, theft or a road accident while a vehicle is carrying your items to your new home.

However, exclusions and conditions can apply to this type of cover. Some policies cover the items in transit, but not when they are being loaded and unloaded from the vehicle.

Other policies may not provide cover if you fail to let your provider know about your moving plans. Or if you use a removalist company that is not deemed professional.

There may also be an exemption if your belongings are stored in a transit facility. Some insurers may restrict transit coverage within its contents insurance policy altogether. Or will only provide this additional cover if you pay an extra premium.

As policies differ, it’s recommended to read the Product Disclosure Statement (PDS) of your policy, or to contact your insurer directly to ask about your cover.

Removalist insurance

If your current contents policy does not provide cover for your belongings while they are being moved, check to see if insurance is available from your removalist. Removal companies are not legally required to have insurance to cover your belongings. If you decide to hire a removalist, research your options carefully and ask family and friends for recommendations.

Standalone transit or moving insurance

If you’re not satisfied with the insurance cover on offer from your contents insurance provider, or that offered by your removalist, there are some specialised moving and storage providers that offer transit/moving insurance.

The price of these policies will depend on a range of factors, including the value you place on your belongings and what circumstances you want covered. Before buying one of these policies, it’s important to read the fine print. Ideally, contact the provider directly to get a full understanding of the cover’s inclusions and exclusions.

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Which items are excluded from cover while being moved?

Some items are excluded from insurance cover while they are in transit. However, the specific item exclusions will vary depending on your chosen insurance policy and policy provider.

Some contents insurance providers specify they will not cover for loss or damage in transit: cash, smart cards, phone cards, or documents able to be cashed or traded.

They will also not cover items that are excluded from cover under a contents policy. These items may include electricals (phones, laptops), building materials, business or trade stock, pets or animals, plants, trees and shrubs, chemicals, pesticides and firearms.

Some standalone transit or moving insurance providers also exclude particular items from cover or restrict the amount of cover on offer. For example, some insurance providers will not cover living plants, pets, cash, banknotes or jewellery. Others won’t cover antiques, works of art, money, medals or jewellery unless they are specifically declared.

How much does transit insurance cost?

If you choose to purchase transit insurance through your removalist or as a standalone product, the costs for cover will differ depending on a number of factors. These include:

The level of cover chosen

Full transit insurance may cover for loss or damage to insured goods under all circumstances. Restricted cover may only insure items for loss or damage resulting from nominated events such as fire, flood or an accident on the road. Typically, full insurance cover costs more than restricted cover.

Full replacement or market value

You may be able to choose between covering items for their full replacement cost, or current market value. The market value option typically covers the replacement cost of items less a reasonable allowance for age, condition, and depreciation. Market value often carries a cheaper premium.

Types of belongings you are transporting

If you are moving fragile, breakable or high-value items (e.g. a piano or artwork), you may have to pay a higher premium.

Distance moved

Typically, those moving a greater distance can expect to pay higher premiums compared to those moving within the same city.

Method of transport

Some types of transport (such as via road) may carry higher risks than others (such as via sea or air), and may carry a higher premium as a result.

Excess applicable to the policy

The excess is the amount you need to pay the insurer when making a claim on your insurance. You may be able to adjust the excess amount when taking out your policy. Typically, the higher the excess chosen the lower your premiums. However, you will then need to pay more if you have to claim on your policy.

What if I’m moving overseas or back to NZ?

If you are relocating abroad or moving back to NZ from overseas, there may be transit insurance options available through your chosen shipping, freight or cargo company. Or from an insurance company that specialises in international transit cover. You can research your transit insurance options online, or talk to an insurance broker about the best policy to meet your needs and budget.

What about insurance once you are in your new home?

If you have an existing home and contents insurance policy, you’ll need to contact your insurer to notify them you are moving. Discuss changes that need to be made to your insurance policy for your new home. For example, do you need to adjust the amount your property is insured for, and have purchased new furniture?

If you don’t have home and contents insurance or are looking to review your cover, consider comparing your options and requesting quotes from a couple of providers.

Keep in mind that the cheapest policy may not always provide the cover you require. It’s a good idea to read the PDS of any product before making a decision.

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About the author of this page

This report was written by Canstar’s Editor, Bruce Pitchers. Bruce has three decades’ experience as a journalist and has worked for major media companies in the UK and Australasia, including ACP, Bauer Media Group, Fairfax, Pacific Magazines, News Corp and TVNZ. Prior to Canstar, he worked as a freelancer, including for The Australian Financial Review, the NZ Financial Markets Authority, and for real estate companies on both sides of the Tasman.