Baggage & Personal Effects

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Baggage & Personal Effects

Baggage and Personal effects coverage provides protection for the complete loss or damage to your personal effects and luggage.

ALL RISK vs NAMED PERIL

"All Risk" means that all risks of loss are covered except those that are specifically excluded.

"Named Peril" loss is limited to only those risks of loss (perils) which are specifically listed in the policy and which are not specifically excluded.  Included perils might be fire, theft,

"All Risk" is broader than "named peril" coverage however, some "all risk" policies have begun to include exclusions which eliminate certain "perils" such as "mysterious disappearance" thereby moving their plans closer to the "named peril" ones.

Primary vs Secondary

"Primary" coverage means that you usually deal directly with the travel insurance company first.  However, there are some exceptions to this, usually when you have more specific coverage that applies to specific articles such as a named article rider on your homeowners policy that insures a specific article.  Such coverage would usually apply first.

"Secondary" coverage means that you would have to submit your property loss claim to your homeowners/tenant insurance coverage first before the travel insurance company would consider a payment.

Exclusions & Limitations

All baggage policies have exclusions and limitations - make sure you read them carefully because they restrict the policy and your coverage.  Some typical limitations include:

  • limit for the loss of any one article
  • pairs of articles
  • business owned articles
  • property shipped as freight
  • wear and tear and gradual deterioration
  • inherent vise (my personal favorite - it means defects in workmanship).

What can you expect when you file a claim?

The insurance company will provide you with a claim form and directions on the information that they will need.  Here is a list that might be included:

  • complete list of items lost or damaged including the date of purchase,
  • copy of notification that you made to the proper authorities or to the party responsible for the loss.  This might include:
  • police report for theft
  • property irregularity report to the airline who had custody of your bags,
  • receipts for the items that were lost or damaged.  Receipts are required to prove that you owned the property or were responsible for it and it establishes how long you've owned the article for determination of depreciation.

The value of your articles will be depreciated according to when you purchased the article and when the loss occurred.  Companies use a concept call "actual cash value" to describe depreciation and how they establish current value of the item.  Some companies will use the original purchase price to determine the starting point for depreciation and some companies will use current replacement cost as a starting point.  Usually you are better off with current replacement cost for the article however, whether they use original or replacement cost the determination is made by the insurance company.

Note that the biggest cause for delay in processing a claim concerns the amount and quality of the information that you provide.  Always provide the insurance company the information that they requested - do not assume that they know it even though it might be apparent.  Also make sure you copy everything that you send to the insurance company.

As with all claims, the burden of proof is on you so the more information you have and the closer you follow the insurance company's instructions the faster they will be able to handle you claim and the more accurate they will be able to pay you.