Insuring Jewelry and Other Precious Items
Posted on Tue, Jan 31, 2012
Standard homeowners' insurance policies and renters policies cover personal belongings in your home such as furniture, clothing and electronics. They will also cover jewelry and other precious items such as watches and furs. However, most homeowner policies provide very limited theft coverage for jewelry, generally $1,500 and no coverage if it’s lost. If you only own a modest amount of jewelry (say just a few hundred dollars), perhaps the limited coverage provided by a basic homeowners policy is adequate. However, when high values or even sentimental value are involved, consider buying additional insurance coverage. The sentiment behind your jewelry is priceless, but the rings themselves can be replaced -- if they're insured -- in the event that something happens to them.
There are two ways you can increase coverage for jewelry and other expensive items: 1) By raising the limit of liability or 2) "Scheduling" your individual pieces through the purchase of "floater" policies. Raising the limit of liability is the cheapest option; however, there may be a limit on the amount you can claim for the loss of any individual piece, say $2,000, when the overall limit is $5,000.
Scheduling each piece or item may cost more in premiums, but it offers broader protection because the floater covers losses of any type, including accidental losses-such as dropping an engagement ring down the drain of the kitchen sink or leaving an expensive watch in a hotel room-that your homeowners insurance policy will not cover.
The yearly cost to insure your ring is $12.50 to $16.50 for every $1000 of value it would cost to replace. In plain English, this means that if your ring would cost $9,000 to replace, you might expect to pay between $100 and $150 per year to insure it -- or slightly more in cities where the risk of theft is higher.
Have copies of the sales receipt and appraisal for the insurer to keep on file. Appraisals not more than 3 years old are required on higher valued items. The appraisal should describe the jewelry in detail and give a valuation. The appraisal is a record of the quality of your jewelry and will be used by the insurer to determine both the premium charged and the amount of loss to be paid. Appraisals are often accompanied by a detailed photo of the piece. If this is lacking, take a photo of the jewelry yourself and bring it along.