Do You Need Storage Unit Insurance?

When you keep things in storage, there's always a risk your items might get damaged, stolen or lost. When that happens, having a solid storage unit insurance policy can make the difference between an unfortunate inconvenience and a devastating loss. It's possible that your items are covered by your homeowner's insurance, but those policies are usually capped at a relatively low level and might not cover the real value of your stored items. Storage unit insurance, sometimes called tenant insurance, is a helpful supplement for many renters, who might not otherwise be able to get full coverage for their stored items.

Key Points

  • 1 Homeowner’s insurance may not cover enough of your stored items’ cash value.
  • 2 Storage unit insurance is an important part of keeping items stored.
  • 3 Some properties require storage unit insurance for high-value items.
  • 4 Insurance policies vary in their details, and it pays to shop around for the best policy to cover your items.

Not every renter needs storage unit insurance, though it can usually provide peace of mind even for stored items of limited cash value. Some storage providers may require their tenants to get insurance that covers their unit, especially if the items stored have high replacement values. This guide is intended to explain why storage unit insurance is important to some renters, when it makes sense to hold tenant insurance and the various options storage renters have to cover their valuable stored items.

Why Is Insurance Important for Items in Storage Units?

People keep all sorts of items in storage, including some very valuable things that could be expensive to replace, if they can be replaced at all. Almost all storage unit properties offer some kind of security for their renters, which ranges from security cameras and an onsite manager to regular patrols and emergency response in case of a break-in. All the security in the world, however, cannot guarantee items will never be stolen or lost, and there’s always the possibility that items can be lost in a flood, a fire or another disaster. When that happens, renters may have no other option but to try to recover their losses from an insurance carrier.

Holding a good storage unit insurance policy can do more than ensure that your items are covered. Having an insurance carrier to call in the event of a disaster, a break-in or another event can streamline the process of recovering from your loss. Without a policy to cover your high-value items, your only other option besides taking the loss may be to appeal to the property management, or even to try to recover your losses with a costly and drawn-out lawsuit. Having a single point of contact, one who is experienced with claims like yours, can help you recover quickly and with as little fuss as possible.

When it Makes Sense to Get Storage Unit Insurance

Storage unit insurance makes sense for a lot of renters, but it isn’t always a must-have. If you’re storing items you consider low-value or easy to replace, for instance, the additional cost of insurance may not be worth it to you. If, however, you later add a few valuable items to your storage unit, it can change the math quickly and make insurance a better choice.

Another reason to skip tenant insurance might be if you are already covered by another policy. Many renters’ off-site items are already covered by homeowner’s insurance, at least up to a point, and relatively low-value items are often adequately covered by such a simple extension of the existing policy.

Homeowner’s insurance has limits, however, for what it will cover away from your house. Coverage for items stored in a remote location is often capped at just 10% of your general homeowner’s policy. If, for example, your home is covered for up to $50,000 in lost property, you might be capped at just $5,000 for items you keep in storage. If all you have in your rental unit is a couch and some boxes of clothes, this might be enough. If the combined value of your stored items exceeds your limit, you might consider either expanding your homeowner’s policy coverage, or you could buy a supplement just for your storage.

The property you’re renting space from might require you to buy insurance. Many properties have decided to cover their exposure by simply requiring all tenants to carry insurance for their stored items. While the extra requirement to carry insurance may put off some renters, the extra protection a policy offers the property management could save endless trouble for the company with eventual lawsuits or other actions by uncovered tenants.

Regardless of your property management’s policy, it still makes sense to hold good storage unit insurance if you plan to store especially valuable items. Jewelry, vehicles and other high-priced items can be extremely difficult or impossible to replace if they’re lost. Some other items, such as work tools or computer equipment you use from time to time, may have to be replaced quickly to keep you in business, which is really only possible with the fast and relatively simple cash settlement an insurance policy offers. You may also need insurance to cover the equivalent cash loss if your items were valuable to you but not necessarily of intrinsically high value, such as files containing customer data or personal items such as albums and keepsakes.

What Are the Options for Storage Unit Insurance?

You have a lot of options when you’re in the market for storage unit insurance. The first option is to add off-site coverage to your homeowner’s insurance policy. If that is too expensive, or if the coverage is capped at too low a level to cover your exposure and you’re unwilling to expand your main policy, you might have to look elsewhere. One option is to pay the cost of insurance as part of your storage rental fees. Many property management companies offer renters the option to add insurance to their basic rental agreement, and some require it as a condition of renting the space. Certain specialized high-value storage companies, such as wine storage providers, often ask for an estimate of the cash value of the stored items and assess insurance as part of the intake process. If none of these options are right for you, or if you find a good deal on your own, it makes sense for you to buy a separate policy.

How to Get Storage Unit Insurance

If you need storage unit insurance but you’re either unwilling or unable to buy coverage as part of your rental agreement, it pays to take your time shopping for a good policy. Start by talking to your current insurance agent, since your existing relationship can make the process easier and save you time and money. Many agents can even find you a discount for adding an extra coverage item to your existing policy, which in extreme cases could even result in paying less overall for your bundled policies. If you decide against adding coverage through your existing policy, you may have to go shopping with other companies.

What to Consider with Storage Unit Insurance

There can be a lot to think about when you’re buying insurance. Depending on what you’re covering and how much coverage you need, the policy you end up buying can be either simple or very complex, very expensive or well within your budget. Storage unit insurance policies have several dimensions for you to consider, and every buyer has to strike a balance between options that work for them.

One of the first things to consider is the overall coverage you’re buying. If your policy is capped at a certain amount, make sure it adequately covers the value of your stored items. In the case of certain collectibles, such as classic cars, fine wines and other unique items, the value of these possessions could easily increase while they are in storage. Don’t forget to periodically reassess your coverage to make sure you’re still covered for the full amount of your items.

Insurance policies also vary in the deductibles they charge. For many people, this is a determining factor. Having to pay a high deductible can erase much of the value of an insurance policy, especially for medium-value property and cases where losses are likely. If you don’t think a loss is likely, or if your stored items are exceptionally valuable, you might be willing to take on a high-deductible policy and save on the monthly expense.

The policy you’re looking into probably has several details that vary enormously between plans, and they are all worth considering before you make the decision to buy. One policy, for instance, might require that you secure your items in a particular way, such as with heavy-duty padlocks that your storage company might not be willing to allow. Another policy could impose reporting requirements if you regularly add to or remove items from your storage unit.

Buying insurance for your storage unit is an important part of protecting the items you wish to keep safe. When the inevitable loss occurs, having a good storage unit insurance policy can be a lifesaver and help you quickly recover from serious damage, theft, fire and other losses. Whatever your situation, it is always a good idea to take your time and do adequate research before you settle on a plan. Whether you’re buying insurance directly from the storage provider, adding coverage from your existing plan or you’re shopping around with third-party providers for an ideal plan, buying great storage unit insurance is one of the best investments you can make for your stored items.