FAQs

Your agent is correct (partially). Specifically: for all perils insured against under a homeowners policy for Coverage C “unscheduled personal property” guns are covered under a “replacement cost” basis or an “actual cash value” basis. This coverage part covers guns up to the limit insured for under Coverage C.

There is one very important exception. This pertains to the peril of theft. There is a section of all homeowners’ policies titled “special limits of liability for Coverage C unscheduled personal property” that restrict the amounts payable under the policy for the peril of theft. The types of personal property affected are those items that burglars or thieves target. These items include guns, cash, precious metals or coins, stamps, fine arts, jewelry, furs, goldware, and others. Most policies limit coverage for the theft of guns between a limit of $1,500 and $5,000 TOTAL (not for each gun).

Another reason we feel that guns should be insured under a separate policy (other than homeowners) deals with insurability and privacy. Some insurers are becoming “gun shy” (no pun intended) on the issue of guns on a homeowners policy. Not so much regarding the guns themselves (values of guns). They are becoming increasingly nervous of a homeowner’s liability for both gun use and potential gun loss (theft of guns).

Liability lawsuits (all homeowners policies include liability insurance as well as property insurance) targeting gun owners who have had guns (in particular handguns) stolen from them are on the rise. Allegations of “failure to protect the public” or “negligent storage” or variations thereof are cropping up when a stolen firearm is used in a violent crime. Defense is provided under a homeowners policy without limit as well. Accordingly, this type of loss under a homeowners policy may result in a cancellation or non-renewal of the policy. Therefore, why not carve the guns off the homeowners policy and alleviate this scenario?

Another important reason is coverage and cost. Most homeowners’ policies charge between $1.50 to $1.80 per $100 in gun value. Our rate is approximately 1/6 of that amount. Our coverage format is broader as well and is addressed in other questions.

Most insurance contracts that cover guns provide coverage for theft anywhere in the world. Having said that, there are contractual restrictions that adversely affect the scope of this coverage. Every insurance contract has “conditions” and “exclusions.” One specific limitation deals with a provision known as a “locked vehicle warranty.” Most policies will stipulate that theft of a gun from a vehicle is not covered unless the vehicle was locked at the time of the loss and there were visible signs of forcible entry.

Our contract has a locked vehicle warranty as well, but it is far less restrictive. Our policy says that theft from vehicles is covered, even if the vehicle is unlocked at shooting venues, shooting clubs, or shooting ranges. Our intent is to provide broad coverage for theft while at shooting venues. We also remove the “locked vehicle warranty” when being shipped by a common carrier.

There are 3 valuations on our policy in the event of a covered claim; they are “stated amount,” “replacement cost,” and “fair market value.”

The best methodology to utilize is generally “stated amount.” In this format, you schedule the gun and accessories, provide serial numbers, and declare a value for the guns to be insured. Upon a covered claim, we will pay up to the amount purchased and possibly 25% more than that. (See “Insufficiency of Limits” under Coverage & Limits.) All guns over $10k in value have to be scheduled on a stated amount basis. Many people schedule guns that are less than $10k to secure the stated amount format.

If guns are insured using the “blanket/unscheduled” option and there is a covered loss, the valuation is “fair market value.” This is defined as the reasonable cost to repair or replace with property of like, kind, and quality of similar age and condition. If repair or replacement of property with like, kind, and quality and a similar age is not available, fair market value will be the actual cost to repair or replace without deduction for depreciation.

“Accessories” are insured with a “replacement cost” valuation. Payment for a covered claim is first issued using actual cash value for the value of the item lost/damaged. The insured then has 24 months to replace the accessory. Once the insured replaces it, we will reimburse the difference (if any) to the insured.

Our intent with trophy/hunt replacement coverage is to provide the insured with a payment that is more in line with the amount invested into a hunt. Our limits are generally 75% of what a hunter spends on a particular hunt, some being higher some being less.

There are too many variables to calculate specific limits for each hunt/species that an individual has taken. A whitetail hunt for example can cost anywhere from $0 to $25k. We are able to make some modifications (on larger collections) however it is subject to approval.