Do you really need self-storage insurance?

Brian on

Picture of a garage that is very cluttered.There’s a pretty good chance that, as part of your move into a new home, you’ll need to rent a self-storage unit from a local facility. Maybe your new home isn’t completely finished, or maybe you simply don’t have the time to move everything in one weekend and need to keep it elsewhere for a time—either way, self-storage can be a very practical solution to your moving problems.

There’s also a pretty good chance that, when you arrive at the storage facility, the manager will ask you if you have insurance. "Insurance?" you’ll probably respond. "Yes, I have homeowner’s insurance" or maybe "Yes, I have renter’s insurance."

And then there’s a pretty good chance that the facility manager will say: "Yes, but do you have storage insurance?"

To which you might think: what is storage insurance? The idea behind storage insurance is quite simple: your valuables are sitting in a storage locker in the middle of a storage facility and, if some natural disaster like a flood or an earthquake or a tornado strikes, the facility is not legally responsible for the well-being of your things. When the facility manager explains this to you, there’s a pretty good chance that you’ll smile, shake her hand, and ask her where you can fill out the paperwork.

But do you need self-storage insurance?

The short answer: NO. The slightly longer answer: very probably not.

What your facility manager didn’t explain, and what they probably don’t want you to know, is that in almost every circumstance your preexisting homeowners, renters, or business insurance will cover every possible case in which you might need storage insurance in the first place. So the truth is that you already have coverage (in cases where your items are extremely valuable, you should always make sure that they’re listed on your insurance policy to begin with). That’s right: so long as those items are listed on your policy, it usually doesn’t matter if you move them out of your house and into a unit—they’re generally still covered, at least for a limited time period, by your existing homeowner’s or renter’s insurance.

But if that’s true, why is the facility manager still trying to sell it to you? And why--if you Google the second part of this article’s title-- will most other articles out there tell you that you do need storage insurance?

Because it’s an upsell: the facility makes more money if they sell you a policy. Of course, if you don’t have homeowner’s insurance in the first place, storage insurance might be a good buy, so it’s good that facility managers are making the pitch to you. But if they fail to mention that your existing policy probably covers everything already, they’re being manipulative. Just like when a rental car company suggests you purchase collision insurance, the facility is playing on your fears to make an extra buck.

Now, to be fair, many facility managers might not be aware that they are being manipulative. Orders might come down from the owner or from corporate that require them to suggest self-storage insurance, and the facility manager might be totally unaware of the insurance situation in the first place—their job, after all, is to run the facility, not to deal with insurance companies. But sometimes the manipulation can, sadly, become quite extreme. Some facilities will require that your items be insured—a good idea, as after all the facility is not reprehensible in the case of a natural disaster, and verifying everyone’s insurance in the first place allows them to avoid any tricky legal situations down the road. In those cases, you should request proof from your insurance agency that the items going into the unit are covered.

There have been a few reported cases of facilities that require proof of insurance, but won’t tell the renter until the day they move in, and then demand proof immediately. This forces the customer to purchase a policy from the facility, as most people aren’t able to easily back out of such a situation. If this happens to you, ask the facility manager if your policy could be refunded once you return with proof of coverage. If they say no, notify the owner immediately. To prevent such a headache, go in with proof of insurance in the first place.

Finally, in case you’re still considering purchasing storage insurance, know that we at SelfStorageDeals.com have heard all kinds of horror stories about how storage insurance is a scam, how many facilities selling it aren’t licensed to do so, and how storage insurance companies are notoriously stingy and will deny claims for even the most common occurrences, like damage from floods or insects. So before shaking that facility manager’s hand and scribbling your John Hancock on the paperwork, we highly recommend that you: 1. Verify with your insurance agency that your items are on your policy and that the policy still applies when they’re moved offsite, and 2. Bring proof of your policy with you when you move into the storage unit.

Brian Shreckengast is a writer at SelfStorageDeals.com, a leading price-focused search engine for finding cheap storage units. Read more about storing and moving on the SSD blog.

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