Does Homeowners Insurance Cover Stolen Cash?

Homeowners insurance protects a dwelling and its contents from various unforeseen events, including theft. The primary purpose of such a policy is to provide financial relief when covered perils lead to damage or loss of property. This article examines whether stolen cash is covered by a standard homeowners policy and outlines common limitations. Understanding these aspects helps homeowners manage expectations regarding potential claims.

General Personal Property Theft Coverage

Homeowners insurance policies typically extend coverage to personal property, safeguarding belongings both within the home and, in many cases, when they are temporarily removed from the premises. This personal property coverage generally applies to items such as electronics, furniture, clothing, and even specific valuables like jewelry or art. Coverage for personal belongings is often set as a percentage, commonly between 50% to 70%, of the overall insurance limit on the home’s structure.

While theft is broadly recognized as a covered peril under these policies, the extent of coverage can vary significantly depending on the type of item stolen. For instance, a policy might cover the replacement of a stolen television, but certain categories of property, including cash, are subject to distinct rules.

Specific Limitations for Stolen Cash

Homeowners insurance policies offer some coverage for stolen cash, but it is almost always subject to a low sub-limit. This sub-limit is a specific cap on the maximum payout for certain types of property, considerably less than the overall personal property coverage limit. For physical cash, typical sub-limits can range from as low as $200.

This low limit also applies to “money-like” items such as banknotes, gold, silver, and coins. Other valuable papers or items, including securities, deeds, letters of credit, and passports, often have specific sub-limits, which might be around $1,500. Precious items like jewelry, watches, furs, firearms, and silverware are also commonly subject to special sub-limits, typically ranging from $1,500 to $2,500 for theft losses. These lower limits exist due to the difficulty in accurately proving the exact amount of cash or other valuables lost, which also helps deter fraudulent claims.

Filing a Claim for Stolen Cash

If cash is stolen, promptly contact law enforcement to file a police report. Obtaining a copy of this official report is crucial, as insurance companies typically require it to process a theft claim. This documentation serves as formal evidence that a theft occurred.

After filing the police report, notify your insurance company as soon as possible. Providing proof for cash can be challenging, but any available evidence helps. This might include bank withdrawal slips, ATM receipts, or personal budgeting records. Cooperate with the insurance adjuster, providing any requested information. The final payout will be subject to the policy’s specific cash sub-limit and the applicable deductible.

Reviewing Your Policy and Increasing Coverage

To understand the extent of coverage for cash and other valuables, homeowners should carefully review their insurance policy. The “personal property” section or a “special limits” section will detail the precise sub-limits applicable to various belongings. This review helps identify any potential gaps in coverage.

If the amount of cash or other high-value items regularly kept on hand exceeds these standard sub-limits, purchasing an endorsement can increase coverage. An endorsement, also known as a rider or floater, is an addition to your policy that provides expanded coverage beyond standard limits for specific items. This additional coverage comes at an extra cost but offers enhanced protection for valuable assets that would otherwise be underinsured.