What Is Worldwide Coverage?

Worldwide coverage is a characteristic of some insurance policies provided by insurance companies that globally covers the insured business or individual against loss or damage. Worldwide coverage ensures that no matter where an individual's personal property is lost, stolen, or damaged, they will be covered for any associated losses. It also covers certain aspects of financial loss to a business.

Key Takeaways

  • Worldwide coverage is a global policy provided by insurance companies that covers the insured business or individual against loss or damage, globally.
  • Worldwide coverage may only be valid for a certain period of time and may need to be renewed periodically.
  • The documentation and premiums required for worldwide coverage depend on the type and value of coverage.
  • Worldwide coverage usually applies only to personal property, obtrusion of business, and crime.
  • In the U.S., most workers' compensation insurance, commercial auto insurance, and general liability insurance only cover the U.S., Canada, and Puerto Rico.
  • When a policy doesn't specify the coverage territory it usually implies that it is worldwide coverage.

Understanding Worldwide Coverage

Certain insurance policies, such as personal property insurance, allow policyholders to add worldwide coverage to their existing policy, usually for an additional premium. The worldwide coverage can be requested in the amount needed for valuable possessions. Some limits apply to certain types of property, and some property might be excluded from coverage depending on the insurance company.

Typically, because of the different laws in different countries, worldwide coverage only applies to property, issues related to the obtrusion of business, and crime. It's critical to understand where your insurance applies before finalizing your business or personal insurance.

Some insurance companies distinguish between blanket coverage, which involves coverage of items between certain prices, and scheduled coverage for individual items that may fall outside of blanket coverage values. The latter requires detailed documentation and a bill of purchase attesting to the cost price. In some cases, worldwide coverage may only be valid for a certain period of time.

Examples of covered items include jewelry, furs, cameras, musical instruments, silverware/goldware, golf equipment, fine art (such as paintings, vases, antique furniture, oriental rugs, rare glass, and china), collectibles, sports equipment, and computer equipment.

Coverage Territories

Insurance is a location-based business. Nearly every type of policy assumes it will be in force in a stated geographic area, known as the coverage territory. Most liability policies, for example, only cover incidents that occur in the coverage territory. 

Most policies issued in the U.S. include the U.S. (with its territories and possessions), Puerto Rico, and Canada. They would also cover international waters or airspace if the injury or damage occurs while a person or property is traveling between the U.S., Puerto Rico, and Canada. 

For an additional cost, policies can include anywhere in the world other than the U.S., Puerto Rico, and Canada. For a business, this might include liability for products used or sold outside the U.S. or even claims arising from something a business put on the Internet that was accessed in another country. The limitation for many of these policies is that any suit must be brought in the U.S., Puerto Rico, or Canada.

Types of Insurance and Their Coverage Territory

Standard commercial auto policies include the U.S., Puerto Rico, and Canada. Insurance for driving in Mexico, for example, must be bought in that country or as a rider to a standard U.S. policy. Auto policies for private vehicles are worldwide with certain stipulations.

Workers' compensation insurance applies to the state it's purchased in and the laws that that state created. Some workers' compensation insurance does extend to employees who are traveling in other states and overseas on a temporary basis.

Homeowners insurance is tied to the property insured but certain theft and liability coverage can extend to the location of the policyholder in another state or country, but only under certain, limited circumstances.

Most health insurance policies cover any health issues that occur worldwide. For example, if you have a health insurance policy from a U.S. insurer but break your leg skiing in France and have to go to the hospital, your health insurance policy will most likely cover that.

When a policy doesn't specify the coverage territory it usually implies that it is worldwide coverage.