If you own several valuable firearms, it is a good idea to review how well they are covered under your Homeowners policy. Although you might have more personal property coverage than you think you could ever use, that doesn’t mean that your five or ten thousand dollar gun collection is fully insured.
While most Homeowners policies will fully cover guns destroyed in a fire (up to your overall personal property limit), theft is a completely different issue. If someone breaks in and steals firearms from your home, your policy may not pay for the full loss.
Homeowners policies cover most of your personal property up to the policy limit, but there are certain types of property with much smaller limits. Examples of property with special limits include (among others) business property, cash, gift cards, coins, precious metals, securities, deeds, watercraft, trailers, silverware, jewelry and firearms. For these last three, the special limit usually applies to theft only.
Most standard Homeowners policies limit theft of firearms to $2000 or $2500. The policy deductible will apply to a gun theft claim; so if you carry a $1000 deductible, you are likely underinsured if your guns are worth more than $3000 to $3500, put together.
I talk to many, many gun owners in northern Minnesota for whom standard firearm limits are nowhere near enough. So what can be done to provide better coverage for your guns?
Increase the special limit
A few policies may give you the option of simply increasing the $2000 or $2500 firearms theft limit to be a little bit higher. Maybe they will let you go as high as $5000 for twenty or thirty dollars a year in premium. In this case, they may limit the value of any one gun to $1000, and your policy deductible will still apply. Unfortunately, the majority of carriers don’t offer this option.
Buy an coverage upgrade package
Many insurance companies offer a package of extras that you can add to your basic Homeowners policy which may add additional coverage features and/or increase your policy’s special limits. Such a package could provide a higher limit for theft of firearms.
Depending on the pricing of this coverage package, this may be a great way to get more coverage for your guns. However, you might also find that your carrier’s package offerings don’t increase firearms coverage at all or that the increase only adds another $500 or $1000 in coverage, which might not be enough to really help.
Schedule your valuable guns
Most insurance carriers will allow you to schedule firearms on your Homeowners policy as a way to get them fully insured. Since the two options I discussed above are often not available or insufficient, scheduling firearms might be the only way to get the insurance coverage you need under your current policy.
When you schedule firearms or other personal property, you are specifically insuring it for a specified amount. Your schedule will identify each item insured, with a description and value. When you schedule, your policy deductible does not apply; there is often a very low deductible or no deductible at all.
One strategy would be to schedule your most valuable firearms, freeing up your policy’s firearms limit to apply to any or all other guns that you don’t schedule.
Scheduling firearms isn’t usually cheap. The most common rate that I see is $2 per hundred in value. So if you scheduled $5000 worth of firearms, you would pay $100 per year in premium. Or a $10,000 schedule would cost $200 annually. (I do represent one or two carriers with rates that are lower than this.)
While scheduling your firearms may be the only way to get them fully insured under your Homeowners policy, not all gun owners feel comfortable doing so. Some are hesitant to create a list of their guns and share it with a third party. While this list would not be in the public domain and would generally not be accessible by government authorities (short of a subpoena or the like), such assurances might not be enough to calm all fears.
A few carriers offer a way to resolve this dilemma with blanket firearms coverage. Blanket coverage is similar to scheduling, as rates may be about the same and the policy deductible might not apply. However, with blanket coverage, you are only specifying an overall limit; you don’t have to list each item insured. This might be a good solution, on the off-chance that it is offered by your carrier. (Only one carrier I represent offers this.)
Thinking outside your policy’s box
If none of the suggestions above work for you, it might be worthwhile to think a little broader than your Homeowners policy. For example, if you belong to a gun owners association, your association might offer firearm coverage to members. They might include a small amount of coverage automatically as a membership perk and then give you the option to purchase a higher limit. I’ve looked at one such offering that had better rates and also no requirement that you provide a list of your guns.
To think even broader, there are ways to manage your risk other than insurance. You can reduce your risk by purchasing and faithfully securing your firearms in a gun safe. At that point, you can decide whether you now feel comfortable self-insuring this reduced theft risk.
I hope this post has been helpful in explaining the limitations of Homeowners insurance when it comes to guns, as well as what you can do about it. If you have any questions, I’d love to hear from you.
About the Author
Agent Ken Cobb
Ken is the owner and principal agent at Pine Country Insurance in Bemidji. Active in the insurance industry since 2000,Ken uses his years of personal insurance knowledge and experience to assist clients in customizing insurance coverage to fit their needs. Ken considers himself a "farmer" rather than a "hunter"; rather than focusing on writing a lot of new policies as quickly as possible, he works on cultivating long term relationships based on trust with his clients. When writing new policies and meeting for annual reviews, Ken spends time with his clients explaining and helping them understand their insurance, and he is also pleased to share his knowledge with his blogging audience as well.
Ken Cobb is owner of Pine Country Insurance and has been active in the insurance industry for over 15 years. Meet Ken.
Coverage descriptions found in this blog are summaries provided for general educational purposes and cannot fully detail the terms, conditions, limitations or exclusions of a specific insurance policy. Please read your policy carefully.