How Does Insurance, Valuation, and Licensing Work?

When you’re looking to hire a moving company, the first thing you’ll want to do is check out the MnDot booklet on the subject. After you’ve gotten an idea what you’re looking for, start your search with the Better Business Bureau and Yelp (CMM has an A+ and a 4 ½ star rating, respectively.)


But how do you know what you’re actually getting when you hire the services of a moving company? A company representative will be able to tell you, certainly, but if you’re the skeptical or inquisitive type, you might want to know more. What does it mean to be licensed and bonded? What are the mechanisms by which contracts are guaranteed? If you’re not a fan of dry contractual details, be warned: this post gets a bit technical.


When a moving company says they are licensed, this usually refers to a business license. A business license is granted by the federal or state government, and indicates that a company is approved to legally conduct business, in the form of being hired for the purpose of moving services, within their state or country or across state borders. In Minnesota, this means a “Household Goods Mover Permit”. Check with MnDOT’s Office of Freight and Commercial Vehicle Operations to make sure the company you’re considering has a permit to operate and is licensed and insured.


Many people mistakenly confuse bonding and insurance. Being bonded means that the company guarantees that they will perform the work you hired them to do. This means that a third party will ensure reimbursement if a company or contractor fails to meet their end of the bargain.


A professional moving company (like CMM) will offer valuation. This is the rough equivalent to insurance, but legally speaking, it isn’t identical. Let’s dive into the nitty-gritty.

Valuation is based on transportation and transit laws. It’s a level of liability the carrier agrees to assume and, depending upon the level of protection requested by the customer, may result in higher transportation rates. Valuation limits liability to the time in which the goods are in the care, custody and control of the carrier’s actions or failure to act that are not excluded by the provisions of the Bill of Lading and tariff.

Essentially, valuation means that should your items be broken in transit, while in the carrier’s care, you will be compensated. The level of valuation, however, is not always clearly understood by the customer. Some moving companies have base-level insurance policies in place that compensate you for breakage or loss of items on a per-pound basis, the industry standard being for common carrier household goods shipments being $.60 per pound per article. At CMM, you always receive this base-level coverage, and have the option to purchase additional coverage besides.

In closing, be sure you fully understand your coverage before you sign a contract and request additional coverage if necessary. Believe it or not, the company you’ve hired wants to keep your possessions safe just as much as you do!