Keeping the Promise of ProtectingYour Transferee’s Household Goods

Wouldn’t it be great if you were guaranteed certain things in life? Peace of mind, happiness, stability? What exactly is a guarantee? Merriam-Webster defines a guarantee as “assurance for the fulfillment of a condition”. Aside from being a term hurled around by professional athletes assuring a win, true guarantees are rather uncommon.

As your transferee begins to prepare for their relocation, what if you could guarantee them that all of their possessions would be fully covered from loss, damage or theft? Such protection exists! As a Human Resources professional for your organization, the better you understand the protection options available, the more protected your transferees will be.

“Aside from being a term hurled around by professional athletes assuring a win, true guarantees are rather uncommon.”

What Protects My Transferees?Your relocation service provider makes every effort to ensure the safety of your transferee’s household goods throughout each stage of the moving process. However, in spite of the most careful efforts, sometimes damage and loss can occur during the relocation. After all, furniture is meant to be in one’s home, not stacked ten feet high in a truck, traveling 60 miles per hour down freeways across the country. Should damage or loss occur, your transferee will be compensated for their damaged items at some level, based on the type of valuation coverage specified in the moving contract.

In the Moving and Storage industry, coverage for your transferee’s household goods is known as Valuation Coverage. Valuation coverage is not insurance. Instead, it is the level of liability that your relocation service provider assumes for your transferee’s possessions while in transit or storage under the service provider’s authority. In simple terms, if your transferee’s household goods are lost or damaged in transit, valuation coverage is a specified amount that the relocation service provider agrees to pay on a claim caused by them. Valuation coverage is mandatory by Federal law for all movers and under the regulations set forth by the Federal Motor Carrier Safety Administration (FMCSA), your relocation service provider is required to offer at least two levels of protection. Following is an examination of the two levels of valuation coverage provided by nearly every van line.

Basic Liability

“A total loss is rare, but even if only one item is damaged, Basic Liability is not enough.”

Basic Liability protection provides your transferee with the minimum level of protection in the event of loss or damage. This level of protection is offered to your transferee at no additional cost, however, it is very limited.

Under Basic Liability, the value of the household goods is calculated at sixty cents multiplied by the weight of the shipment. For an 8,000 lb. household, the overall value of the shipment is $4,800. In the very rare event of a total loss, the mover is only liable to pay the transferee $4,800, hardly enough to replace what has been lost.

A total loss is rare, but even if only one item is damaged, Basic Liability is still not enough. For example, if your transferee included a 30 lb. flat screen television valued at $450 in their shipment and it was damaged in transit, under Basic Liability protection your transferee would be reimbursed $18 for the damage to the television. ($.60 per pound x 30 pounds).

Basic Liability is limited in its benefits with one notable exception– it is included with the move at no cost to your transferee. It is highly recommended that you do not choose this option.

Full-Value ProtectionFar more comprehensive than Basic Liability protection is Full-Value Protection. Stevens Worldwide Van Lines recommends this level of coverage for your transferee; it is the best level of protection available for their household goods.

With Full-Value Protection, the minimum coverage level is calculated as follows: the weight of the shipment is multiplied by six dollars per pound. This total equals the minimum declared value of the shipment. Your transferee should consider the minimum coverage amount carefully to ensure it is enough to cover all of their possessions. Coverage level on a homeowners’ policy is a very good guideline to use. Items are then repaired or replaced up to the current replacement cost of the item and subject to the maximum declared value.

Referring back to the example of that 8,000 lb. shipment, in the case of a total loss, at minimum coverage the mover is liable to reimburse the transferee $48,000 in the event of a total loss.

Additional benefits of Full-Value Protection include the calculation of replacement costs at today’s costs with no applied depreciation. Additionally, some carriers – including Stevens Worldwide Van Lines – provide even more coverage: repair or replacement is applied to sets and pairs. For example, if one chair in a set of four is affected, all four chairs would be replaced if the affected one could not be repaired, or exactly replaced.

While Valuation Coverage is intended to cover all items within a household goods shipment, there are limitations. If your transferee has items that would be valued at more than $100 per pound, they are considered to be items of high value. Items of this nature typically include antiques, collectibles, silverware, crystal, precious metals, artwork, oriental rugs, electronics, firearms, fine china and some computer software. To ensure that these articles are not limited to minimum liability, they will need to be listed on the High Value Inventory form, which the carrier will provide. Make sure to record serial numbers and manufacturers’ marks before the High Value Inventory sheet is signed. Taking photographs or video recordings of the items of high value prior to shipping should also be considered.

The driver must be able to verify the existence and the condition of the high value items; they cannot simply be tendered to him in a sealed box.

It is necessary for your transferee to sign the High Value Inventory form even if no items of high value are declared. Your transferee will also be required to sign the High Value Declaration on the Bill of Lading contract.

Not everything your transferee owns belongs on the moving van. Relocation service providers will ask that your transferee keep their jewelry, currency, small valuables and other irreplaceable items with them, as they will not be accepted as a part of any shipment.

Another Consideration: High Value Items

Do Limitations Exist on Valuation Coverage?Certain situations and conditions will limit or nullify the coverage of your transferee’s household goods shipment. Such conditions include:

• Packing dangerous or hazardous materials in a shipment without the mover’s knowledge. There are certain materials that cannot be included in a shipment, and your relocation service provider should give a listing of these items to your transferee.

• Transferees packing their own boxes. If the articles that the transferee packs themselves are damaged, establishing a claim on those damaged items may be more difficult.

• Your transferee failing to notify your relocation service provider in writing about items of extraordinary value.

• Signing a delivery receipt containing any language about releasing your relocation service provider or its agents from any liability. By law, your transferee has time to file a written claim. Your transferee should strike out this kind of language or refuse delivery of their household goods until a proper receipt is provided.

Your relocation service provider should make every possible attempt to educate and inform your transferee of all of these conditions that would lead to an instance of limited or nullified coverage on their household goods shipment.

Are There Any Common Misconceptions?There are a few major myths that are common when it comes to valuation coverage. Below we will set the record straight on these valuation myths.

While Full Value Protection does entitle your transferee to replacement of a damaged item during their move, if it can be repaired as an alternative to full replacement then that route may be preferred by your relocation service provider. This varies by organization and by service agreement but in most cases it is up to the discretion of the relocation service provider.

Much to the same effect that you don’t receive a refund each month from your insurance company when you don’t file a claim, your relocation service provider does not refund your transferee’s money if an incident does not occur with their shipment.

We cannot stress this enough. As with insurance, the proper packing and inventory processes must be followed to assure your transferee is fully protected.

It is important that your transferee takes the time and inspect their items at the time of delivery and provide notice to their mover about any loss or damage. The sooner your transferee provides notice to their mover about loss and damage, the greater the likelihood the mover will accept liability and the transferee receives compensation. The longer your transferee takes to report loss or damage, it may impact their ability to be compensated on the claim. The transferee will have up to 9 months to file a claim for their loss or damage with the mover on interstate shipments. Keep in mind that these timelines may be different depending on your contract with your relocation service provider.

Myth #1 – Full Valuation Protection always means damaged items will be replaced

Myth #2 – If valuation coverage is not used, it will be refunded

Myth #3 – Purchasing valuation guarantees compensation for claims

Myth # 4 – I can wait for months before I tell the mover I have a claim

“Just as with insurance, the proper packing and inventory processes need to be followed to assure your transferee is fully protected.”

Do my Transferees Have Access to this Benefit?Federal law requires that your relocation service provider provides two levels of valuation coverage for all customers including your transferees. However, based on your service contract with your relocation provider, the cost to your organization for coverage above the Basic Liability level will vary. In addition, some companies will purchase additional blanket policies from a third-party insurance company for added protection.

Is There Anything Else I Should Know?Reviewing your relocation policy with your service provider is crucial and should be done on an annual basis. This is a great time to brush up on the details of how your transferees are protected through your service provider’s coverage options. It is also a perfect time to consider renegotiating if you feel as though you could be receiving a lower cost for your organization.

In the event that your relocation service provider is not offering you the protection to your transferees that you are seeking, please reach out to us! Stevens Worldwide Van Lines has years of experience with protecting the household goods of transferees from hundreds of organizations. If you’re interested in learning more about the coverage that Stevens offers, we encourage you to contact us by email at talentmobility@stevensworldwide.com

Sources::http://stevensworldwide.com/personal-household/moving-coverage

https://www.fmcsa.dot.gov/sites/fmcsa.dot.gov/files/docs/Rights-and-Responsibilities-2013.pdf

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