Why Insect Damage Is Typically NOT COVERED

By The Selzer Company

 When customers place their household goods into the care of a moving and storage company, most assume that the standard liability protection offered under a bill of lading or warehouse receipt will cover any loss or damage. However, one category of damage that consistently surprises customers isinsect and pest damage.  Whether it’s a moth‑eaten rug or other insect activity, these losses are almost always excluded on the bill of lading. Here’s why:

 Liability Coverage for “Accidents”—Not Preventable Deterioration

Mover liability programs and warehouse legal liability policies are built to cover accidental, sudden, and unexpected events. Think of drops, impacts, collisions, or mishandling—incidents directly related to the moving and storage process.  Insect activity is different. Damage caused by bugs, moths, carpet beetles, or similar pests occurs gradually over time, not through a single event. For insurers, this type of damage falls into the category of:

• Preventable maintenance issues
• Environmental or biological conditions
• Natural deterioration

Because these are ongoing, foreseeable processes, they don’t meet the definition of “accidental physical loss.” As a result, they’re almost universally excluded.

 It’s Nearly Impossible to Prove When or Where the Infestation Began

From a liability standpoint, insect damage presents major practical challenges:

• Did the bugs come from the customer’s home?
• Did they originate inside the stored item itself (common with rugs and textiles)?
• Did they enter the warehouse despite proper pest‑control measures?
• Did the damage occur over weeks? Months? Years?

Since most insect damage is not immediately visible, it’s extremely difficult—often impossible—to determine origin, timing, or responsibility,  which is why this category is excluded across nearly all movers’ liability programs.

 Warehouses Cannot Guarantee a Completely Pest‑Free Environment

Even the cleanest, professionally controlled warehouse cannot guarantee the complete absence of pests. Movers also cannot fully control:

• The condition of items when loaded
• Hidden infestations inside rolled rugs or upholstered goods
• Pest activity that originates from customers’ belongings stored nearby

Expecting a mover or warehouse operator to ensure a 100% pest‑free environment would be unrealistic and insuring that risk would be cost‑prohibitive.   By excluding these exposures, policies stay focused on what they are designed to cover: damage caused directly by the mover, not by the environment.

 The Shipper Has a Responsibility Too

Warehouse receipts generally require customers to:

• Prepare and inspect items before storage
• Ensure goods are free of infestations
• Properly clean and wrap textiles, especially rugs and fabrics
• Use professional cleaning when needed

These duties place responsibility on the customer to prevent insect‑related damage at the source.

What Movers Should Do

To protect themselves and maintain transparent customer relationships, movers and warehouse operators should:

• Educate customers early about these exclusions
• Encourage rug cleaning before shipment or storage
• Recommend sealed or climate‑appropriate packing materials
• Document pre‑existing damage or odors
• Include clear contract language referencing insect/mold exclusions. Include documentation for the customer to sign off wherein they explicitly acknowledge that these sorts of damages are excluded from your liability.

 Proactive communication and executed documentation helps set expectations and reduces the risk of disputes.

 Key Takeaway

Liability coverage for Moving and Storage Companies—whether under $1.00 per pound, $20 per pound, or any standard valuation option—is designed for handling-related losses, not damage caused by insects, mold, or other natural processes. By understanding and communicating why these exclusions exist, movers can better protect themselves and help customers make informed decisions about caring for their goods.