You have a computer. So who doesn’t? According to the latest reports, the vast majority of Americans have at lest one personal computer at home. And many count themselves among the “multi-wired” households, with one or more PCs, handhelds (such as Palms or pocket PCs), set-top boxes, Internet access, and a fast-growing minority have enough equipment to have installed home networks to tie everything together. Add in a few beepers and cell phones and we are talking significant value!
With this much money tied up in such items, can you count on your homeowners insurance to step in if you suffer a loss?
Looking at a standard policy, the answer is affected by several factors.
Perhaps the major question is how much do you use these devices for business purposes? A typical homeowners policy limits coverage to $2,500 total for items used primarily for business purposes. Note the key word is “primarily.”
Doing your taxes or bringing home some work is not enough to make your PC subject to the business property limit. But for the many people that have set up a home-based office, either for regular telecommuting or for an in-home business, the $2,500 limit will kick in. And also note the limit applies to all such property. Include your filing cabinets, office furniture, printer, fax machine, bookshelves or whatever else makes up your business at home and the $2,500 limit is usually met rather easily.
But here’s the real kicker – if you use that business notebook (or “laptop”) computer while away from your home, the business property limit drops to $1,500 (if you have a car accessory to power the device). That limit also includes any accessories to be used with the computer, such as a portable printer, projector, external drive or zip disks.
A second consideration is what causes of damage are covered?
In a standard policy, first see what specific covered causes (known as “perils”) are listed. Simple breakage is not included. Anyone who has ever accidentally dropped their laptop knows that sinking feeling of wondering if they have seen the last spark of life from their trusted companion.
Another possibility not typically covered is power surges or spikes. If one of these occurs and fries your computer’s circuits, there will be no payment for the damage under your policy.
So how can you be sure to get the best coverage for your computer? First, talk to your local Trusted Choice® insurance professional about what options are available under your current coverage to tailor it to best fit your particular equipment and needs. The answers are different depending upon whether business is involved or if all of your computing power is for personal use and entertainment. Standard endorsements to your policy are available to raise the internal limits (such as the $2,500 and $1,500), and/or broaden the perils provided by the policy (either for all your property or just the computer and accessories).
Also don’t overlook the good habits of computer usage that have nothing to do with your insurance, but might either prevent the loss or make it less painful.
- Find a decent backup program and use it faithfully. Keep the backup disks somewhere besides your home. If the whole house burns down, that set of regular backups you kept in your downstairs closet isn’t going to be of much help.
- Purchase an adequate surge protector and plug your computer and all of your peripherals into it. Consider getting one that also has a place to plug the phone line coming from your wall jack. Power surges and lighting can travel over phone lines as well as power cords.
- If you travel with a notebook computer, take precautions to protect it from being damaged or stolen.
For more ideas, read through the documents that came with your computer, log onto the manufacturer’s website, and check with many of the other help sites pertaining to computers or your type of business. And don’t forget to ask your Trusted Choice® insurance professional. While he or she has expertise in helping you arrange coverage for your potential claims, you might be surprised how much they know about preventing them!
After all, the best possible claim is the one that never happens!