Does Homeowners Insurance Cover Theft?

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Does homeowners insurance cover theft?
When and how does homeowners insurance cover theft?
How much do I have to pay if homeowners insurance doesn't cover theft?
If homeowners insurance doesn't cover theft, what will?
Expert(s) Found on this Page

Is theft covered under a standard homeowners insurance policy?

As a new homeowner, I’m curious about what all is covered under my insurance. I have a lot of valuables and other property that I’d hate to have to pay out of pocket to replace if I ever got robbed. Is theft covered under a standard homeowners insurance policy?

Yes, it is. Standard homeowners insurance policies provide coverage for theft of your personal property, often even if it’s not stored directly in the home.  The only thing to keep in mind is that certain kinds of personal property have their own special coverage limits dictated by your policy. So, all of your property may not be covered equally. Your best bet is to review your specific policy along with your independent insurance agent to be sure.

Homeowners insurance will not only help reimburse for stolen items, but it will also offer protection for your home in the event that it gets damaged upon the intrusion. The dwelling category of your homeowners insurance includes protection from damage inflicted by intruders. Coverage includes reimbursement for repairs necessary to your home's structure and likely even personal property damaged during the incident as well.

When and how does homeowners insurance cover theft?

Your personal property is protected under standard homeowners insurance policies in several ways, one of which is theft. If someone breaks into your home and steals a bunch of your stuff, your insurance company will reimburse you for the loss—up to your policy’s limit. Coverage may also apply to property stored off-premises such as in a storage unit. You might also be covered if your stuff is stolen while you’re staying at someone else’s house. Your home's structure is also protected.

How much do I have to pay if homeowners insurance doesn’t cover theft?

After paying your deductible, you’ll be responsible for paying any amount exceeding your homeowners policy’s limit for the personal property category. This limit will vary by each specific policy. If you have a bad break-in and a lot of your stuff gets stolen, the value for all that property will add up quickly. If you have several highly valuable pieces, you might want to increase your coverage limit.

A standard homeowners policy has a deductible that’s typically 1% of the home’s value—so if your home is worth $300,000, you might have to exceed $3,000 in stolen personal property before your insurance will start paying. You could easily lose a lot of money this way. If you have lots of valuable property you want covered, it’s a good idea to work with an experienced independent insurance agent to get a policy with a lower deductible.

If homeowners insurance doesn’t cover theft, what will?

Structural damage to your home will be covered up to your policy's limit for coverage in the dwelling category. Stolen property will be covered up to your homeowners insurance policy’s limit for personal property, but your stuff might easily exceed that, especially when lumped together for one big reimbursement following a break-in. Consider purchasing specialized endorsements for valuables like jewelry and electronics. 

Also, keep in mind that various categories of property have their own specific limits which are often lower than that of the general personal property category’s limit. For example, your policy may limit coverage for jewelry to $2,000. Even more of a reason to look into special floaters or endorsements for pricier items so you don’t end up losing money through insufficient coverage. Your agent can help you get set up with all the coverage you need.

One last thing to note is that your homeowners insurance policy doesn’t provide coverage for theft of your vehicle or property stored in your vehicle. You’d need to refer to your auto insurance policy for that. Many standard car insurance policies do cover theft, including stolen property and damage done to the vehicle by break-ins.

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