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Most Insurance Won't Cover the Expensive Electronics in Your Checked Bags
travel

Most Insurance Won't Cover the Expensive Electronics in Your Checked Bags

Patrick Allan, Gawker Media

Photo by Masakazu Matsumoto .

With an electronics ban in place for most flights coming from the Middle East and North Africa, and the threat of a laptop ban hanging over our heads , there's a good chance you'll have to check your expensive electronics with your luggage on an upcoming flight. Too bad there's nothing you can do to cover loss or damage.

Whether you're forced to check your laptop or not, airlines are very adamant about not being liable for any damage, theft, or loss of items. It's covered in every major airline's contract of carriage that you agree to every time you fly. For example, United , American Airlines , and Delta all pretty much say the same thing: we'll carry it, but we're not responsible for it. If anything happens to your stuff during transit, you're screwed.

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What's worse is most insurance won't recoup your losses. Travel insurance isn't a bad idea when you're traveling, but it's not perfect. Some travel insurance companies will cover loss or damage of luggage items, but the amounts covered can vary significantly, and not all plans cover electronics like laptops and cameras. Julie Loffredi, travel editor for InsureMyTrip , explains to the Los Angeles Times :

"While a policy may say baggage is covered up to a certain amount, the amount of coverage will almost always have a per-article limit, a specific amount they will cover for any one item... This will vary by policy but is usually around $200 per article."

If you're traveling with a $1,500 laptop and a $1,000 camera, you're only getting a fraction of the value back. Plus, Loffredi notes that travel insurance should be a last resort when trying to recover those types of losses.

Homeowner's insurance, on the other hand, might do you one better, but it depends entirely on your policy. If you have a deductible in the ballpark of $500 to $1,000-like many people do-it's not going to do much for your loss of one or two items while traveling. Also, your insurance policy might pay out in different ways. If you have a "replacement cost endorsement" (which costs more money), you might receive the amount required to repair or replace the item with no deductible for depreciation. However, if you have an "actual cash value policy," the value would be based on depreciation. As you know, electronics depreciate very fast, so getting the actual cash value for a laptop that's only a few years old could be next to nothing. Susman Insurance Agency explains :

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...if your computer is covered, it is probably only covered to a limit of perhaps $1,500... unless you purchased a replacement cost endorsement, your claims adjustor will deduct the use and wear of however many years ago you purchased the laptop or desktop. Assuming you bought a scaled down MacBook Pro laptop three years ago, your computer might be currently valued at $500 - not even counting the software updates. But there's one more thing: you chose that $500 deductible way back when you first purchased your policy. You know, so you could save money. So, your insurance company owes you $0.

Oh, and one more thing: your homeowner's insurance policy may not cover items used for business purposes at all, or at best you'll be limited to a much smaller amount.

Besides protecting your electronics and data as much as you can beforehand , there's not a whole lot you can do. If you're desperate for coverage, you might consider a "valuable articles" or "valuable items policy," which is usually used to cover items like antiques and jewelry. These tend to be replacement cost policies, which cover everything if it's lost or stolen, but they can be expensive. Plus, you have to take the extra time to fill out the paperwork and all that. When you're busy getting ready for a big trip, it's an easy thing to forget.

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