What is a personal floater policy?

Shoes. Sweaters. Skis. Stereo. Selfie sticks. You buy one thing, then another, until your apartment or house is full. You don’t notice it adding up, but the total value of your possessions can be well over $25,000.

Your renters or homeowners insurance covers your property or the “contents” of your home if items are damaged or stolen. But some things are worth so much money that their replacement value may be too limited in a standard insurance policy.

Your custom touring kayak cost you $6,000. But, if it’s stolen during a burglary, your policy may reimburse you only $2,000 for the loss.

Is this a scam? No. Insurance works when very large groups of people have similar risk levels. And most people do not have a high-performance kayak, vintage acoustic guitar or a colonial era coin collection. Policies are designed to pay claims for clothes, furniture and other property of average value.

This helps to keep premium costs low for everyone. But how can you protect your high-ticket treasures?

If you have an item worth $5,000 or more, a personal floater policy is a good idea. This is coverage you purchase as an “add-on” to your primary renters or homeowners policy.

How does it work?

Before you buy a personal floater policy, you will need to have your item appraised and document its value (or be able to provide documentation attesting to its worth, like a receipt). If it’s lost, damaged or stolen, the insurance company will pay you the amount you need to repair or replace it.

Compared to the coverage you get from renters or homeowners plans, personal floater policies have some extra perks. First, you typically do not have to pay a deductible before the insurance kicks in. That means is the insurer approves your claim for $9,000, you will receive a check for $9,000.

Also, these policies cover more risks, or perils. For example, if you lose your jewelry in another country, a visitor to your home breaks an antique or your camera equipment is destroyed in a hurricane, a personal floater policy will cover the loss. A standard policy probably will not.

What are some items covered by personal floater policies?

Own anything on the list below? Think about extra coverage. Most policies cover the item, as well as accessories and cases.

  • Jewelry
  • Music and audio gear or instruments
  • Fashion and accessories
  • Bikes and bike gear
  • Art and design objects or antiques
  • Silverware
  • Camera and other photo or video equipment
  • Sports equipment
  • Special collections (like coin collections, stamp collections or wine collections)
  • Firearms