STEPS TO TAKE

• Sort and Eliminate
• Take Photographs or Video
• Obtain Appraisals for High Value Items
• Arrange Cleaning and Repair
• Schedule Packing Dates

REVIEW INSURANCE COVERAGE

Property Insurance

In the United States, personal property and household goods are normally insured under a homeowner's or renter's policy. For an overseas assignment, different types of insurance are necessary.

The US Government does not insure your household effects. However, the Military Personnel and Civilian Claims Act provides some compensation for loss or damage to personal belongings. The maximum amount payable under the Claims Act is $100,000, but there are a number of limitations and exclusions. There are restrictive per-item limits under the Act, and reimbursement is not made for replacement value of an item, but only for depreciated value (this includes the price of an automobile if one was shipped). The Act authorizes payment for personal property only; it does not provide for theft of your cash. No compensation is paid for loss or damage to easily pilferable items or small items of value that are normally worn or carried. Because of a dollar limitation on the replacement of items in certain categories, the full value of the lost or damaged item may not be covered. Depreciation is a factor in determining the amount to which the employee would be entitled. Antiques are considered for their utilitarian value only. They are never appreciated for claims purposes. Employees who incur uncompensated losses can take an income tax write-off. Taking this write-off, however, will trigger an automatic IRS audit.

Do not rely on shippers, packers, or commercial storage companies to provide comprehensive insurance coverage. Such insurance may be inadequate or unavailable. Also, when loss or damage does occur, it can be difficult to determine which of the parties involved in the packing, shipping, or storage process is responsible.

Therefore, commercial transit insurance and a household goods floater policies that cover goods taken overseas and items left in storage are strongly recommended. Many companies do not insure household goods worldwide. The Overseas Briefing Center maintains a list of insurance companies that handle transit insurance and policies for overseas locations and has brochures available from those companies. Also check advertisements in The Foreign Service Journal. Word-of-mouth recommendations from colleagues who are pleased with their companies can be most useful.

Normally, insurance policies are written to cover purchase price minus depreciation. Inflation makes it advisable to consider a "replacement cost coverage." High-value items such as silverware, jewelry, and fine arts may need additional coverage. A professional appraisal is usually required, which may be difficult to obtain overseas.

An up-to-date inventory of all possessions is essential for establishing proof of loss. Lists, photographs, and original purchase receipts should be included. Leave one copy of this inventory in the United States, and take another with you overseas. Inventory booklets are available from most insurance companies. One is included in the Foreign Service Assignment Notebook.

It is important to keep your insurance policies with you overseas. This will allow for quick reference regarding coverage and exclusions, and will provide valuable information when filing a claim at time of a loss.

Liability Insurance

Liability insurance covers your legal liability for accidents on owned premises (residence or property) that result in bodily injury and/or property damage to others. When you live in your home/condo or rent an apartment, this is normally covered under a homeowner's or renter's policy. If you rent out your house or condo while you are overseas, you may still be liable for accidents on the premises. An "Owner's , Landlord's , and Tenant's Liability" policy should be obtained for the period while your home is rented to others.

When overseas, you should consider a separate comprehensive personal liability policy with worldwide coverage independent of specific residence or place of assignment. Comprehensive personal liability insurance should be carried if pets are owned, even if living in government-owned quarters. The U.S. Government provides coverage for liability in government-owned housing except for incidents involving pets.

Prominent persons (even PTA or scouting can make you prominent) in the community should consider an umbrella liability policy. It will cost less if it is from the same company that provides your automobile, homeowners or renters, and comprehensive liability policies. Umbrella liability insurance provides protection in addition to comprehensive liability insurance. It protects against libel, slander, mental anguish, false arrest, malicious prosecution, humiliation, defamation of character, and invasion of right to privacy.

Diplomatic immunity can protect the foreign service employee in many liability situations overseas, although it can be waived by the Ambassador with the approval of the Department of State. This immunity extends to the immediate eligible family members accompanying the diplomat on a tour of duty overseas.

For questions dealing with diplomatic immunity and liability, see the section of What Do I Do Now? entitled "Privileges and Immunities."

Foreign automobile liability insurance should be purchased prior to operating a vehicle overseas. Most countries require that Primary Automobile Liability coverage be purchased locally within the country to which you are posted. This coverage can be purchased through an American insurance agent who represents these local companies or through an agent within the country.

Sources of Sources of Information

Overseas Briefing Center
National Foreign Affairs Training Center
4000 Arlington Boulevard, E2126
Arlington, VA 22204-1500
(703) 302-7277

Office of the Assistant Legal Advisor for the Office of Legislation and General Management (L/LM)
Room 5425
Department of State
Washington, DC 20520
(202) 647-5154