Homeowners insurance often has limits on coverage for jewelry if it’s lost or stolen. Luckily, fully insuring your jewelry is simple and cost-effective. Continue reading to learn how.
Know What Your Existing Insurance Policy Covers
If you already have personal property coverage as part of a homeowners, renters, or condo policy, you likely already have some form of protection for your jewelry. The typical insurance policy will cover you, up to your policy limit, for jewelry that’s stolen or damaged in certain incidents, such as a fire at your home. However, the typical policy will not cover everyday damage, such as a stone falling out of its setting.
In addition to knowing when you’re covered and when you’re not, it’s also important to know how much you’re covered for. Your insurance policy may cover each individual piece of jewelry at a set amount, such as $1,000 per piece. Or, it may cover your jewelry collection as a whole, such as $3,000 for all pieces.
Calculate the Value of Your Jewelry Collection in Today’s Dollars
To determine whether you have enough jewelry insurance, you need to know how much your pieces are worth. Keep in mind that your pieces may be worth more now than when you bought them. The value of precious metals and precious stones can increase over time, so have your pieces appraised about every three years.
Use these appraisals, as well as receipts for recently purchased items, to add up the value of your collection. Then compare it to how much jewelry replacement coverage you have on your homeowners insurance, condo insurance or renters insurance.
Decide Which Items Require Additional Coverage
If the jewelry coverage on your policy is lower than the value of your collection, you’ll likely want to purchase additional coverage. For example, you may have a $2,000 pair of diamond earrings, a $7,500 engagement ring and an insurance policy that covers jewelry loss – no matter how many pieces – at $3,000. If both pieces are lost in a single incident, you’re short $6,500 of coverage.
To fill this gap, you can insure high-value items individually, as part of your homeowners insurance, condo insurance or renters insurance. This is known as “scheduling valuables” or adding a “rider” or “endorsement” to your policy. To do so, you’ll need a recent receipt or appraisal establishing the value of each item.
Once scheduled, if an item is damaged or lost in a covered incident, you’ll be covered for the full scheduled amount. Typically, scheduling an item also gives you broader coverage. A lost stone that isn’t covered under your homeowners policy, for example, is likely covered under a policy rider.
Catalog Your Jewelry in a Home Inventory
Once you arrange coverage for your high-value jewelry, it’s important to create a home inventory or update an existing one to catalog your valuable belongings. This isn’t as important for your scheduled pieces because your insurance company has a record of their value. However, for any unscheduled pieces that are lost or stolen, you’ll want a record of their worth.
Ideally, your home inventory will include photos, receipts, appraisals, descriptions, brand names, etc. of all valuable personal property, not just your jewelry. That way, if there’s a loss, you’ll already have the documentation needed for a personal property claim in place.
A home inventory can be as simple as a Word document (save it to the cloud or a flash drive in case your computer is damaged or stolen). Or use a mobile phone app, such as the home inventory app, to help you catalog your belongings.
Insuring jewelry is easy and affordable, often costing as little as $10 a year for each $1,000 of coverage. If you have any questions or would like a quote, contact me.
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