Contents insurance is also referred to as personal property insurance. To make it plain and simple, contents insurance covers your stuff. It could be a TV, laptop, gaming console, clothes, gym equipment, or even those luxury towels you splurged on. On the insurance policy, these items are referred to as named perils.

The amount of contents insurance is dependent upon the value of the personal property you own. Prior to purchasing a policy, take inventory of your stuff so you can accurately estimate how much coverage is needed. Consider photographing your belongings, and document the serial numbers, makes and models, and date of purchase. Attach receipts or organize emailed receipts (proof of purchase) so they can be appropriately filed. If you need to file a claim, you’ll have all the info readily available to file the insurance claim.

When purchasing your personal property insurance, it's important to consider the insurance coverage limits and deductible. Weigh out the options of filing a claim based on the value of your possessions in comparison to the deductible. In some cases, depending on the deductible amount, it will make more sense to pay out of pocket to replace or repair an item.

Contents insurance does typically cover your belongings if you’re moving but not repairs (or damage) caused by movers. However, personal property insurance covers fire and theft. Fire damage can be damage from fire and smoke, including damage to items in your garage or shed. Theft or burglary protects your belongings—sometimes also extending off-premise or in your car. But, there may be lower coverage limits for belongings stored outside of your home.

One additional note is to consider your current (or future) policy coverage terms regarding replacement cost and actual cash value. Think through what makes sense based on the possessions you own and future purchases you’re thinking about.